How Super Affiliates Think

Sell with Relationships

A customer of mine used to be a sales person for a medical equipment company. She sold everything from rubber gloves to high end items like wheelchairs.

I convinced her to stop working for someone else. That she’d be happier being her own boss, and selling the same gear as an affiliate marketer.

Like many affiliates, she struggled at first. She liked writing blog posts, and selling online, but she really missed the daily human contact.

I suggested that she take her affiliate business offline. She could rekindle the old relationships and not just rely on strangers trolling the web.

I told her to get proactive. Go where the customers are. Don’t wait for them to come to you.

Now she’s thinking like a super affiliate. She gets a flyer printed every two weeks and a catalog once every quarter.

She goes and visits all the retirement homes and long term care facilities in her city. They’re far more likely to buy from her, because they know her and trust her.

She belongs to a dozen different affiliate programs. That lets her offer a massive inventory, with more makes and models than any competitor.

She set up an arrangement with the suppliers, so that she uses her own affiliate link when placing orders. How smart is that?

She went from struggling hopeful to super affiliate, by walking away from the web and knocking on doors. Good old fashioned face to face selling.

Both parties get what they want. The long term care facilities get a flyer they can look at and order from. She gets to visit the people she missed and multiplied her income by 20X in the process.

Sometimes you just need to think different. If you spread your advertising across different types media, you can make a mountain of affiliate revenue.

Sell at the Right Time

Another customer of mine is an established public speaker. He gets paid a decent sum for the speaking gigs, but he wanted to increase his back end sales.

I suggested that he set up a computer at the back of the room. That way, people could sign up for his newsletter, or order his products, right after the talk, and all through lunch.

Now he’s thinking like a super affiliate. He tripled his back end sales, because he sells other people’s courses and books, in addition to his own. He also allows the attendees to book him for future talks on the spot.

How cool is that. Triple the sales and he’s never out of work. Just by capturing people at the right moment.

Sell in Bulk

Another customer of mine, used to sell individual items to consumers. He worked very hard for small commissions.

The packaging, serving and cleaning supplies he sold, were also used by caterers, restaurants and hotels. I suggested that he try selling to businesses instead of consumers.

Now he’s thinking like a super affiliate. Sell by the caseload. Same amount of work. Much bigger commissions.

Now he’s got customers in all corners of the hospitality industry. Everything from motel chains to food factories.

Things are going so well, he’s considering setting up a warehouse and importing the goods. Then setting up his own affiliate program.

I told him to keep in mind… that businesses, governments and organizations are run by people. Those people source product suppliers on the internet, just like you do.

No matter how big the company, it all boils down to one person. They make a purchase decision and place an order online, just like anyone else.

Consumers order a quantity of one. Businesses order case loads and pallets. Which would you rather get the commission on?

Sell the Niche

Another customer could be called the original spice girl. She knows more about cooking spices than anyone I’ve met.

She didn’t think she could compete in the space though. It was the usual excuses of… too many people already doing it and not enough confidence.

(If you’d like to discover your passion and learn how to monetize it, download The Uncovery workbook http://www.theuncovery.com .)

I told her to swallow her fear and doubt. Just do it. She started blogging and selling spices, but not the usual stuff, because I told her to ultra niche it.

Now she’s thinking like a super affiliate. She’s selling dried peppers flakes and hot sauces, everything from Szechuan to Sassafras. Other people sell spices, but she knows how to thicken your gumbo.

If you know a lot about something, there are people who want to learn. When you help them by telling, not by selling, they’ll automatically want to buy from you.

Sell Your Passion

Another customer of mine owns a small hobby brew place. He helps you make wine and beer on his premises. You bottle it and take it home when its done.

He wanted to take his “dirt world” business online. To go beyond what he could reach with local advertising.

He took my advice started putting videos online. He shows you how to mix up the batch, attach a fermentation lock, sterilize and fill the bottles. Short 2-3 minute clips with one key concept in each.

He uses a basic no-frills hand held video camera. Then dumps the recording into iMovie for a quick edit before uploading them to Youtube.

He’s positioning himself as the leader in beer making knowledge. That makes people subscribe to his newsletter, shop in his store, and trust him.

Now he’s thinking like a super affiliate. Instead of stocking massive inventory, he uses affiliate links to sell everything from hops to brewing kits online.

The videos do the “cold calling” for him. Because of the knowledge he gives away freely, people know they can trust him when it comes to product recommendations.

So when there’s no customers in his retail store, he’s in the back room on the computer. Busy building an affiliate empire around his passion for beer.

What are you passionate about? What do you love to do? If you have confidence, you can transfer it to others. That’s a key secret to making a sale.

Learning How To Sell

None of these people started as super affiliates. The difference was having someone to talk to. Someone who understands advertising, sales and marketing.

If you’d like to know more about advertising, sales and marketing, give me a call. Once you’re a Dynamic Media member, I’m just a phone call away.

AdSense Account Disabled: What the Hell?!

Every morning when I wake up, the first thing I do is turn to my left side, pick up my iPhone, and quickly scan my new e-mail that came in since I went to bed the night before.  It’s a pretty mindless task that I can do while I’m still half asleep.

But not this past Friday morning.  Nope. I sprung out of bed as you might do when a fire alarm goes off in the middle of the night, or maybe on Christmas morning when you’re 8 years old.  I woke up to this little gem in my e-mail box:

adsense account disabled

Keep reading, and I’ll give you the full story.

The Initial Panic

Panic was probably the best word to describe my initial reaction when I read this e-mail:

google adsense account disabled email

This was no joke – I tried to open my AdSense account only to find a similar message, and nowhere to navigate.  This was one of the things we all fear – having one of our primary online income sources cut off completely.  I was having a great month too – it probably would have been my best AdSense month so far.  Of course, they will be taking away from me what I earned so far this month ($100+) and I’m not sure if my amounts accrued through last month (~$200) will be paid out.

Over a year of hard work, countless hours, thousands of dollars spent – diminished with a simple flip of the switch.  Yes, my sites are still ranking as they were and still receiving traffic as usual, but the primary means of monetization – the one source of income that was destined to keep growing each month – gone.

Sure, there are a lot of ways to monetize a site in general, but micro-niche sites by their very nature have a narrow focus, and therefore, limited means of monetization.  No other ad network has so many advertisers competing for all of the long-tail keywords that we target with these sites.  Sure, that doesn’t stop you from using one of them, but ads that are less relevant are sure to experience a lower click through rate and lower cost per click.

This was my initial panic.  Everything was over – my sites were worthless.  Even worse, I didn’t understand how or why this happened to me.  I’ve followed all of Google’s rules.  My traffic was all organic.  And my ad placements, although on the aggressive side, were well within what’s “allowed” and in no way were set up to wrongfully entice clicks (“invalid” clicks).

So What the Hell Happened?

As I mentioned above, Google is accusing me of having invalid clicks.  What this basically means is that they believe people were clicking my ads for reasons other than general interest in the ad’s content.

For example, if you click your own ad or tell a friend to click your ad, these are invalid clicks.  If you put an image or text next to the ad block that says “CLICK HERE >>>> “, any clicks generated would be considered invalid clicks.  You get the idea.

This of course leaves me baffled because I absolutely did not do any of that.  I know the rules and I know Google is very strict about enforcing them.  I’m not about to risk the status of my account for a $0.68 click.  I’m not an idiot.

Here’s what I think could have happened:  Someone who reads this blog decided to visit one of the niche sites that I’ve made public here in the past, and decided to click an ad – maybe they did it several times in one visit (also known as “click bombing”), or maybe it was spread over a longer period of time…or it was multiple people who did it one time.  Whether it was to screw me over or “help” me,  I have no idea.  I never noticed any irregular activity, so it never crossed my mind.

I can’t say with any certainty that this was the cause, but it’s very possible.  Something similar to this happened to Chris Ducker awhile back, and he suspected the same thing.

I guess the bottom line is, sometimes, transparency comes at cost.  If you read Pat Flynn’s site, you know that after he reported all of his success with his site from the “Niche Site Duel,” copycats started popping up, and probably affected his earnings somewhat (although they are still amazing).

Apparently, I’m Not the Only One

Naturally, when I found out my account was disabled, I wanted to take a look around and see if there was some kind big wave of account disabling by Google – although I suspect they disable lots of accounts on a daily basis.

I came across this thread on the Warrior Forum, and it sounds like there were a lot of people disabled around the same time I was.  Here’s an interesting quote from someone in that thread:

forum-quote

Based on this quote and what others in the thread wrote, it does sound like Google recently disabled a lot of accounts for invalid click activity.  I guess I’m not alone, though that doesn’t make me feel any better.

What’s the Plan Going Forward?

First of all, I appealed Google’s decision to disable my account. This probably won’t do anything for me, but I’ve read some success stories, so it’s worth a try.  I don’t want to try anything drastic until I know for sure that I can’t get my account back.

New Monetization for High Traffic Sites

Although none of my micro-niche sites were clear winners (yet), I am going to take my top sites and find a way to monetize them (how ironic is it that I blogged about my top AdSense sites just days before getting my account disabled?).

I have a few ideas in mind for alternatives to AdSense, and perhaps if people here are interested, I’ll do a whole blog post about AdSense alternatives.  For my top sites, I want to look at each site on a case-by-case basis – some sites may only benefit from another display advertising network, while certain ones may be better off promoting affiliate products or CPA  (cost-per-action) offers.

Overall, Take an 80/20 Approach for My Current Niche Sites

Because AdSense is no longer a viable monetization method for my existing niche sites, some of the sites simply won’t be worth putting any more effort into.  The 20% of my sites that account for 80% of my income will receive most of my focus.  The other 80% won’t be worth the time.   Sites that were only earning $1-5/month with AdSense (which I consider to be profitable) may only earn less than $1/month with another ad network (no longer profitable).

Now, I still have 8+ months left before I have to renew a lot of these domains, so I don’t want to “waste” any traffic that they are currently receiving.  What I will probably do is pick one ad network to apply to all of these sites (such as Chitika, which I already have some experience using).

More Focus on Amazon Sites

For me, Amazon is still a perfectly viable way to monetize my sites, and I still have a handful of sites that had regularly been earning more from Amazon than AdSense each month.  I’ll put more focus on converting traffic for my current Amazon sites, and for any new sites I build, I’ll probably look toward niches where I can easily integrate Amazon affiliate links.

Create an LLC

This is something I’ve wanted to do for a long time, and it seems like now is the perfect time to do it.  Because an LLC would be a separate legal entity, I’ll be able to apply for a new AdSense account under the business name (this is perfectly legal/in line with Google’s terms of service).  Unfortunately, I will only be able to use this account for new sites.  I don’t want to risk associating the new account with older sites, in case they are somehow “flagged” now.

My micro-niche site plan is not over yet, but I will need to invest the time to create new sites and build them up all over again, for the new AdSense account.  Once I go through the process of setting up the LLC, I’ll probably do a post on it here in case any of you are interested in doing something similar.

Lessons Learned

Diversification is Key

You can follow all the rules, have the most amazing content, and have a 2+ year solid track record (as I did)…but if your income all comes from one source (or mostly one source), you are at risk of having it vanish overnight.  People will always make the argument that as long as your sites are getting traffic, losing AdSense isn’t a big deal because there other ways to monetize.  It’s true that there are other ways to monetize, but I don’t think you can say that it’s easy to replace the income, especially with sites that were designed to make money with AdSense.

Google will always act in the best interest of their advertisers, NOT their publishers – this is Google’s key income source.  What this means is, if they have any doubt that you’re not good for their advertisers, they won’t hesitate to get rid of you – even if it doesn’t make sense.  You can’t blame them for trying to protect their business.

If you can diversify your income streams, both by having multiple projects (e.g. different websites) and within those projects, multiple methods of monetizing, you are in a much better position to survive the elimination of one of your projects or income sources.

Authority Sites are Better? Not Necessarily.

I bring this up because I don’t think you or I can conclude that micro-niche sites are specifically targeted by Google, in terms of deciding whether or not to disable an account.   Remember, the Google AdSense team is only concerned with their advertisers receiving quality, targeted traffic.  If your micro-niche site is very focused, and receives very targeted organic traffic, Google AdSense likes this.

Keep in mind, Google AdSense is a separate “team” than the team that handles Google’s search results and ranking algorithm.  Pleasing one doesn’t always mean you please the other.

With all of this said, I think authority sites will always be “safer” in that they have a stronger foundation and are easier to diversify with various monetization methods (ads, affiliate links, e-mail marketing, etc.) compared to micro-niche sites.   So if your site gets “click bombed” and you lose your AdSense account, the site itself will still continue making money from other sources.

Conclusion

While I know this post began in a state of panic, hopefully you’ve seen that I’m actually optimistic overall.  While all of this means I’ll need to do a lot more work, and it may be a little while until I can get my niche site earnings back to where they were (it’ll have to be after tax season), I honestly believe I will look back one day and conclude that losing my AdSense account was one of the best things to happen to my online business.

I feel refreshed, in some kind of sick and twisted way – I feel more inspired to think “outside the box” and  work smarter with my internet marketing projects.

Digital prototypes help university team get $550k+ in technology funding

The U.S. Dept. of Labor has a program in place, funded by H-1B visa fees, to increase the competitiveness of the American workforce. This program, called Workforce Innovation in Regional Economic Development (WIRED), has an initiative under way in the state of Ohio called the Ohio Valley Interactive Technology Alliance (OVITA). OVITA is focused on developing a creative and academically prepared workforce and establishing the region as a center of excellence and innovation in the field of interactive digital technology, which includes the Immersive Internet.

OVITA works with three state universities — Ohio University, Kent State University and Shawnee State University — as well as community colleges and high schools. As with any publicly-funded initiative these days, leadership has to work very hard to justify how money gets spent. Thomas Stead, the Associate Director for Education for OVITA and former department chair at Shawnee State University, recently shared with me some experiences he has had using immersive technology to positively influence budget decision makers. Continue reading

Change is under way at ThinkBalm

Disruptive-thinker-bus-SMALLAt ThinkBalm we’ve had a couple of great years as industry analysts dedicated to covering work-related use of immersive technologies—an early-stage, emerging technology market. We have worked with some terrific people at great client organizations like Altadyn, BP, Chevron, Forterra Systems (now part of SAIC), Linden Lab, Moondus, ProtonMedia, Teleplace, and Tandem Learning. We’ve published nine comprehensive reports spanning market overview, business value, technology selection, barriers to adoption, and best practices—and made this research freely available via our Web site. We launched the ThinkBalm Innovation Community, grew it to more than 470 members, and hosted more than 35 facilitated work sessions, training sessions, and networking events. More than half of our research reports arose directly out of ThinkBalm Innovation Community activities. Continue reading

ThinkBalm Innovation Community is now Tandem Learning Innovation Community

After we broke the news that we planned to disband the ThinkBalm Innovation Community, members of the community expressed lots of interest in finding new leadership for the community moving forward. We are excited to announce that effective immediately, Tandem Learning will assume the community management responsibilities of the newly named Tandem Learning Innovation Community.

The value of this community is in the membership and the collective wisdom and experience of the group, and Tandem’s focus on new technology, user experience, learning design, and strategic business innovation allows them to touch on the areas of interest that bind our community together. We believe the leadership at Tandem is committed to maintaining the integrity of the community while finding new and exciting ways to add value to everyone who participates.

Exciting times are ahead for all of us and we’re looking forward to what happens next! Continue reading

In the name of engagement, InXpo adds game features to its platform

Computer and video games are big—and they’re on their way to becoming big in the workplace. According to the Entertainment Software Association, people in 68% of American households play computer or video games. And according to the NPD group, a global provider of consumer and retail market research information, the average number of hours gamers spend online gaming has increased to 8.0 hours per week in 2010 from 7.3 hours per week in 2009.

When you combine this with the fact that people learn—and have always learned—new skills and information by playing games and engaging in competition, it becomes clear that game concepts and mechanics are destined to be transformed into business tools. It is not a matter of if, it’s a matter of when. Games in the workplace can increase engagement and productivity; help employees set priorities, share resources, and meet goals; facilitate team-building; and help organizations discover untapped leadership skills. (For great insights on these and other aspects of games in the workplace I highly recommend the book Total Engagement (2010) by Byron Reeves and J. Leighton Read. Another great book on the topic is Learning in 3D (2010) by Karl Kapp and Tony O’Driscoll.)

InXpo recognizes this potential and is dipping a toe in the gaming waters

InXpo customers deploy the InXpo Virtual Events platform for a wide range of purposes such as trade shows, meetings and conferences, career fairs, learning and training, and persistent virtual offices. Today, InXpo announced a new offering called InXpo Social Suite. This add-on to the InXpo Virtual Events Platform, slated for general availability in early May, will incorporate games and social network integration. The thinking behind this is that by offering increasingly compelling content and activities, InXpo customers (let’s call them hosts) can increase the engagement of users (let’s call them participants), thereby obtaining benefits such as improved knowledge retention, higher customer satisfaction scores, and increased revenues.

InXpo is working with a game design team from Tribeca Flashpoint Media Arts Academy to create a set of lightweight, casual computer games. The first two games InXpo will offer are a trivia challenge and word scramble. InXpo hopes to have 5 or 10 games in its library by the end of the year. Event hosts will be able to configure the games to reinforce learning objectives or advertise event sponsors’ products, for example. The system will track participants’ points and advancement in the game and list high scorers on a leaderboard.

What it means for business decision makers

If you are looking for ways to increase engagement—for example, increase the amount of time prospects spend on your Web site or attending your virtual conference or trade show, or retain employees or customers longer—adding games to your interaction portfolio may be a boon. Especially games that have a strong social element and allow people to compete with each other in a fun, challenging way.

If you feel uneasy about incorporating InXpo’s game elements into live customer interactions, start with internal trials. Perhaps hold an all-hands meeting or a regional sales meeting in the environment and solicit feedback from participants about their experiences with the game technology.

InXpo’s efforts to incorporate games and game mechanics into enterprise software isn’t new; providers of 3D enterprise immersive software have been offering game mechanics in their products for several years. But the launch of InXpo Social Suite is another sign that the market is driving immersive software toward richer, more engaging environments, regardless of underlying technology.

Immersive tech for meetings/conferences must be scalable and easy to use

In our January “trends” blog post, we predicted that 2010 would be a year of churn in the emerging enterprise immersive software market. It’s only a few months into the year and already a rapid-fire series of events has occurred, setting many industry participants on edge:

  • Forterra Systems was acquired by SAIC (see our February 8, 2010 post about it here).
  • Oracle discontinued funding Sun Project Wonderland (now called Open Wonderland) (see our March 1, 2010 post about it here).
  • Key roles on Linden Lab’s enterprise team were folded into the broader organization and several folks on the enterprise team have moved on, including former general manager Chris Collins.
  • Virtual Worlds Management, the company that has held Virtual World Expo and 3DTLC conferences since 2007, renamed itself Engage Digital Media and has de-emphasized its focus on virtual worlds. The 3DTLC conference and 3DTLC.net blog have been suspended. 3DLTC.net editorial content has been folded back in to VirtualWorldsNews.com.

Continue reading

Pseudo-3D immersive tech adopters illuminate business decisions

I recently spoke with three business decision makers who have been involved with deployment of pseudo-3D immersive environments in their organizations or for their customers. I spoke with Michael Doyle, executive director and editor of the Virtual Edge Institute; Kate Spellman, senior VP and managing director of UBM Studios; and Caroline Avey, director of innovative learning solutions at ACS Learning Services. We talked about why they are using pseudo-3D immersive technology rather than alternatives.

Pseudo-3D is used for conferences and trade shows—but it doesn’t stop there

When you think of virtual event platforms from companies like InXpo, ON24, and Unisfair, what likely comes to mind is large virtual conferences and trade shows. Here are a couple of examples:

  • The Virtual Edge Summit. This conference, which was focused on virtual events, meetings and communities, was held over two days in February, 2010—both online and in Santa Clara, California. Michael Doyle, the executive director of the Virtual Edge Institute, said that 400 people attended in person and 600 attended online.
  • COMDEX. COMDEX was a computer industry trade show last held in 2003. The event had become massive, with more than 200,000 visitors and 2,300 exhibitors. UBM Studios will bring COMDEX back this November as an online event focused on the show’s original audience: the high tech channel. Kate Spellman, senior VP and managing director of UBM Studios, said they expect to have about 35 exhibitors and 3,000 attendees.

While large conferences and trade shows certainly represent the bulk of usage to date, we’re starting to organizations use pseudo-3D immersive software software in other innovative ways. For example, ACS Learning Services held a launch event in January, 2010 for a new company-wide innovation program that leverages an idea management system. The company deployed the Unisfair platform for the launch event and now is leaving it up and running, for one year, to function as a portal for employees who want to learn about the innovation program and the idea management system. The idea behind the portal is to enable self-directed, discovery-based learning, a place to launch the program, a vehicle for social-networking to discuss ideas, and a front door to the formal learning via a deep link to both the learning management system and the idea generation system. The Unisfair platform provides a level of engagement above and beyond what people get from just the learning management system and a webinar.

Pseudo-3D technology meets requirements for scale and ease of use

Vendors like InXpo, ON24, Unisfair and others offer pseudo-3D immersive environments that can scale to tens of thousands of simultaneous users by giving participants the illusion that they are in a 3D environment, rather than delivering a full 3D experience. (See the related March 26, 2010 ThinkBalm blog article, “Pseudo-3D is a rising star, keeping barriers to adoption low.”) In a nutshell:

  • Hundreds or thousands of event attendees requires a highly scalable solution. About 600 people attended Virtual Edge Institute’s Virtual Edge Summit online, accompanying another 400 who attended physically. UBM Studios is expecting 35 exhibitors and about 3,500 attendees at this fall’s COMDEX trade show. Caroline Avey, director of innovative learning solutions at ACS Learning Services, said, “Because we have 15,000 employees located in 170 countries, there is just no way we could have brought everyone together for a physical launch event.” None of the 3D immersive technologies can support this number of simultaneous users being in the same virtual place at the same time.
  • Ease of use sometimes means that browser-based technology is the only real option. At ACS Learning Services, the project team had only six weeks to create the learning objects, design the experience, and customize the Unisfair environment. This required a solution that was simple to configure and deploy. Also, the team had limited insight into the computer setups and Internet access of employees around the globe. This required that a solution that adhered to the least common denominator; it had to be Web-based, with no plug-in.

Hybrid events will move beyond parallel experiences as technology and behavior evolve

A hybrid event is a meeting, conference, or trade show that some speakers and audience members attend physically while others attend virtually. Due to technical complexity and the habits of presenters and attendees, hybrid events are largely parallel events today. Networking activities are segregated: people attending physically mingle amongst themselves, apart from remote attendees. Speakers tend to address one audience or the other (physical or virtual)—not both at the same time.

With the Virtual Edge Summit, which took place in February, 2010, the Virtual Edge Institute has started to tackle some of these issues by:

  • Connecting attendees with electronic communication tools. The event producers set up a Twitter hashtag (#ve10) and encouraged attendees to tweet throughout the event. The producers set up a dedicated screen in some of the meeting rooms to display tweets in real-time, and tried to incorporate tweets into the Q&A discussion. InXpo, one of the virtual event platforms used during the Virtual Edge Summit, provides voice over IP integration with Skype, which enabled participants who were attending via InXpo Virtual Events Platform to communicate with each other via text, voice, or video chat. But participants attending via other virtual event platforms, or in person, had no way of joining in on these Skype conversations.
  • Attempting to cross the visual divide. The producers streamed video of speakers presenting remotely into the physical meeting room, where it was displayed on a screen. Likewise, presentations that took place on-site were streamed out to the virtual environments. Participants attending remotely could watch live video of the speakers presenting. This visual integration was limited to the presenters only. The on-site and remote audiences had no visual connection to each other.

My take: pseudo-3D immersive technology meets some burning business needs

My conversations with these early adopters confirm what I’ve been hearing from others. First, pseudo-3D technology meets requirements for scale and ease of use. When it’s not practical or possible to bring thousands of people together physically, pseudo-3D immersive technology provides an alternative. Full 3D solutions cannot scale to meet this need (yet). Second, pseudo-3D immersive technology will increasingly be used not just for large conferences and trade shows but other things as well, such as training. ACS Learning Services’ use of the technology as a learning portal is a great example.

And third, while hybrid events are largely parallel experiences today, they will move beyond this as technology and behavior evolve. I envision a time in the not-too-distant future when the walls of physical meeting rooms will be lined with displays showing the virtual audience’s communications (and avatars, when they exist), and the virtual meeting rooms will display not only streaming video of speakers but of the entire physical audience. Communication tools and networking opportunities will be available to all participants, whether on-site or remote. Speakers will become accustomed to having distributed audiences, and will more naturally be able to include them in their presentations and discussions.

Pseudo-3D is a rising star, keeping barriers to adoption low

As analysts covering work-related use of immersive technologies, we have long wrestled with terminology to describe the trends we are tracking and put some bounds around an emerging software market. We aren’t the only ones; naming conventions continue to be a popular topic of discussion at meetings and conferences (see the Sept. 28, 2009 ThinkBalm blog article, “To cross the chasm, we must close the language gap.”) The question always seems to come back to, “Do we call it virtual worlds?”

Our answer has consistently been no. We use the term Immersive Internet to describe the big picture. 3D virtual worlds are, of course, an important part of the Immersive Internet—but they are not the whole picture. A glaring example is the adoption of pseudo-3D virtual event platforms from companies like InXpo, ON24, and Unisfair. Enterprises are utilizing virtual event platforms for marketing events, trade shows, training sessions, and more—all use cases that are also targeted by providers of 3D immersive software.

The name game is a red herring

The more important issue is, “What do the trends in adoption of immersive technology mean?” Our recent research findings shed light on our position to include both 3D and pseudo-3D in our coverage of enterprise immersive software:

  • Look where the money is. In our January 19, 2010 ThinkBalm report, The Enterprise Immersive Software Decision-Making Guide, we sized the enterprise immersive software market at $50M USD in 2009. A substantial portion of this number revenue was from pseudo-3D virtual events.
  • Production deployments tell a story. All together, the virtual event platform vendors hosted several thousand virtual events in 2009—InXpo alone delivered more than 1,000 500 and ON24 delivered more than 300. We don’t see any evidence of the pseudo-3D virtual events market slowing down.
  • Customers are lumping it all together. The customers who buy immersive technology are placing little distinction between 3D and pseudo-3D (depending on the use case, of course). They want to solve their business problem; they don’t care about the nitty gritty of how it gets done. Many times we have talked with decision makers who are looking at both 3D and pseudo-3D solutions for bringing a few hundred people together for a virtual off-site event.

Pseudo-3D faces fewer barriers to adoption than 3D

When pseudo-3D wins out over a 3D virtual world (e.g., Second Life or ReactionGrid), 3D collaboration environment (e.g., ProtonMedia or Teleplace), or 3D immersive learning environment (e.g., ARI PowerU or SAIC’s Forterra OLIVE), it’s often because the barriers to adoption were lower (see table). (We covered barriers to adoption, and springboards for overcoming them, in depth in the September 23, 2009, ThinkBalm report, Crossing the Chasm, One Implementation at a Time.)

Barriers to adoption of 3D immersive technology Effect these barriers have on pseudo-3D immersive technology adoption
Technology pre-requisites:

  • Graphics card
  • Computer processing power
  • Disk space
  • Computer headset
  • Permissions to install client software or browser plugin
Pseudo-3D technology runs in a Web browser, with no plugin required. High-end graphics cards and computer processors are not needed.Computer headsets are not necessary (though may be desirable) because users are typically not speaking to each other via voice. Audio from presentations can utilize built-in computer speakers.
Technology pre-requisite: high-bandwidth Internet connection While rich 3D graphics are not being rendered in pseudo-3D environments, video streams are common and can be bandwidth hogs in locations where multiple people are watching video from separate computers simultaneously.
Firewall prevents users from being able to interact with others or the environment. Because the software runs in a Web browser, the needed firewall port is already open.
The user experience:

  • Non-gamers struggle with the user interface
  • Common input devices (e.g., keyboard and mouse) are ill-suited to 3D environments

 

The user experience is familiar to anyone who’s used a browser and attended a web conference. People are accustomed to using keyboards and mice to interact with the Web.

Our take: pseudo-3D is on the rise

  • Market forces support an inclusive definition of immersive technology. Some immersive environments are virtual worlds, but an increasing number are not. They are 3D or pseudo-3D collaboration tools, learning environments, or event platforms. We anticipate that over time, the lines between 3D and pseudo-3D will blur. 3D technologies are constantly pushing the limits of scalability and vendors are starting to include measurement tools, while pseudo-3D vendors are going after training use cases and always-on, persistent environments.
  • Mainstream adoption will follow the path of least resistance. Tremendous power is built into 3D environments, especially when they are combined with communication and collaboration tools. But technology adoption has to be simple for the end user. A “DIY” toolbox or a super-rich 3D environment may not be the path of least resistance. If pseudo-3D continues to outpace 3D in ease of adoption, this is where the customers will go.
  • The technology has to be browser-based—or as easy to use and manage as a browser. Our research has illuminated a number of barriers to adoption of 3D environments that could be circumvented with a simpler, more familiar user interface and streamlined deployment options. Browser technology minimizes installation issues, firewall port issues, and a number of other practical problems. On top of that, browser-based immersive technology fits in with the way people are already working; business applications are increasingly web-based, as are collaboration tools and office productivity software.

Without financial backing, Project Wonderland’s future is in question

At the end of January, Project Wonderland development lead Nicole Yankelovich broke the news that Oracle would no longer be applying development resources to the Project Wonderland enterprise immersive software platform. (For more information about Project Wonderland see the January 19, 2010 ThinkBalm report, The Enterprise Immersive Software Decision-Making Guide.) Oracle laid off most if not all of the Project Wonderland team, which was part of Sun Labs.

In the last few weeks, we spoke with Nicole Yankelovich as well as executives from three small companies Yankelovich cited as third-party software vendors or service providers that offer software products or custom solutions based on Wonderland: Amphisocial, Green Phosphor, and Indusgeeks. Yankelovich is currently working with the open source community to establish a non-profit organization and is pursuing a vision of creating a vibrant ecosystem where third parties can create Wonderland content and contribute to the platform — where people can even distribute entire virtual worlds. But many aspects of Project Wonderland’s future are up in the air.

Our take:

  • Oracle’s move to cut Wonderland funding wasn’t altogether surprising . . . Oracle uses immersive software for some internal and customer-facing events – the company has held conferences like Oracle Developer Day and Oracle Enterprise 2.0 online using virtual event platform Unisfair. But the company does not have immersive technology in its product portfolio and has not been a part of the Immersive Internet discourse to date. And in general, we don’t think of Oracle as a company that has a strong history in developing experimental new technology in-house. Instead, Oracle tends to make acquisitions to flesh out its product portfolio.
  • . . . Though a role exists for immersive technology in Oracle’s portfolio. With Oracle’s focus on enterprise applications, middleware, and now hardware (with the Sun acquisition), opportunities exist to incorporate immersive technology into the company’s portfolio, thereby massively differentiating Oracle products in the market and helping customers decrease their costs and increase user engagement. Some of Oracle’s opportunities include incorporating immersive technology into Oracle Business Intelligence Applications, for 3D data visualization, and into products like Oracle Beehive or Oracle Communications Converged Application Server, for next-generation unified communications solutions.
  • This action does not shed much light on Oracle’s perspective on immersive technology. Oracle may have made the decision to cut funding for Project Wonderland for a variety of reasons. Project Wonderland was an open source project, not a revenue-generating software product; no model was in place for deriving revenue from it. Perhaps Wonderland didn’t have traction in the markets Oracle most wants to pursue — though Wonderland had achieved its greatest traction in the education sector, which is one of the industries Oracle serves. Or it could be that immersive technology is simply too early-stage to pique the interest of the strategists at Oracle.
  • Unless Project Wonderland finds another major backer, it will not remain competitive. The core Wonderland project team is working to secure new backing. If the team can pull together a funded organization, then Wonderland may have a bright future. If, however, the core team move on to new full-time positions, then the outlook for Wonderland is grim. Without development resources devoted to the project, Wonderland will be slow to add new core features and functionality. It will be up to third-party software developers, like Amphisocial, to add new features through Wonderland’s module layer. Without backing for Wonderland’s core development team, the project’s competitors — both open source and commercial — will catch up in areas where Wonderland is currently strong, like security features, platform independence, Java support, and audio/video capabilities.
  • Loss of major backing has eroded confidence in the Wonderland platform. While Yankelovich said that Wonderland supporters — particularly in the education sector — have stepped up to donate hardware and other resources to the project, these donations aren’t enough to fund substantial new development, marketing, and project coordination. Sid Banerjee of Indusgeeks summed it up this way: “While no big company is backing Wonderland, it would be difficult for Wonderland to compete as an enterprise grade platform. Though we still believe it can thrive as an open source platform for the education sector.”
  • Further consolidation is inevitable in this emerging technology market. At the beginning of February, SAIC announced that it had acquired Forterra OLIVE (see ThinkBalm’s posts about it here and here). The market is filling with an increasing number of enterprise immersive software products — we are covering nearly two dozen. We sized the enterprise immersive software market at $50M USD in 2009 — too small to support such a large number of vendors.[1] The business decision maker’s job is hard enough when adopting new technology. Consolidation in the market is inevitable and necessary. There are simply too many vendors in this space for business decision makers to easily choose appropriate technologies.

For Java shops that want to engage in low-cost experimentation, Project Wonderland continues to remain a solid enterprise immersive platform. But given Project Wonderland’s current state of upheaval, we recommend that business and technology decision makers looking for software for a pilot or production approach Project Wonderland with caution unless and until Project Wonderland receives substantial backing.

© 2010 ThinkBalm. All rights reserved.


[1] This conservative number includes only revenue from software licenses and maintenance fees, appliance sales, and subscription fees collected from customers who were using the software for work (as opposed to recreational uses). We did not include revenue from professional services (e.g., custom development projects and implementation services). For more information, see the January 19, 2010 ThinkBalm report, The Enterprise Immersive Software Decision-Making Guide.

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