I just paid $38 to Facebook to promote a post I wrote in Spanish about the iPad Mini and Surface. I did it because I find the business model kind of absurd but want to understand what the rationale behind this is. I also did it because I was surprised the price was $38, like the failed IPO price. You would imagine that Facebook would have given up on charging $38 for anything and I wanted to see what I would get for $38.

I still think that Facebook should offer a $5 per month no ads version of its service. I dislike the fact that Facebook gives me the service for free and is always trying to think how to milk me as a user an activity for which it has an incentive to invade my privacy in all sorts of way.  Especially in trying to make me as public as possible to sell me as a product to others.  Facebook’s ads are so irrelevant, so much worse than those of Google, so irritating.

And there is the language issue as well. I hope FB realizes that my post is in Spanish and does not spam everyone who reads in English with it. I know this sounds absurd and it is so easy to recognize languages. SpotRadio and RadioMe, apps that I developed for Android do this very well on the fly and for many languages at the same time. But Facebook frequently shows me ads that encourage me to learn Spanish. So how aware is Facebook of who I am? It also frequently shows me great looking women with no friends in common with me to befriend and ads for all sorts of ways of meet women even though I am happily married and said I found those ads offensive.

I should have said this at the beginning, I am debating to buy shares in Facebook which has an incredible asset but so far does not know how to monetize it. I bought at $25 but sold at $22 not convinced because all the well known insiders are selling. So I have decided to do this $38 experiment to test a part of their business model. Especially since ads on the web are so easily blocked with Ad Blockers and ads on mobile are tough to monetize at all let’s see what happens.  Will complete the post later as I find out.

10 years ago all of us on the Internet were licking our wounds. We had been taken for a crazy ride in which we went from a point in whatever we touch was champagne to whatever we did was shit.

As an entrepreneur that lived through 1998 to 2002 I emerged reasonably well, I sold my shares in Viatel when it was worth $1.2bn, I sold Ya.com for $700 million but did not sell Jazztel when it was worth $5bn because I was its CEO and saw it go down to $700M (now it`s worth $1.4bn). Then I lost $50M in Einsteinet one of the best cloud computing start ups in Europe that was killed by the post bubble era in which financing completely dried out. So as you read this post you will see no bitterness.

But looking back at 2001/2002 I see this time, not as a period in which Internet companies destroyed the financial markets, but as a time in which the financial markets almost destroyed the Internet. It was financiers/analysts who drove those insane valuations up and then down. What should have been a smooth ride on the internet, an era of taking more and more global citizens in its midst, became a crazy ride in which the internet itself gained enormous prestige and was later, for a while, seen as a useless gimmick. Only around 2007 people again realized that the Internet was simply transforming the world economy and was here to stay.

And then came 2008, when the financial industry practically destroyed the world economy. That was when the same financial firms did to the world what they had done to the Internet, inflate it and let it fall like dead weight.

Having been a happy customer of Goldman Sachs, Morgan Stanley and others I don’t want people to read this post as a rant against financial firms. We need financial firms. But what we don’t need is financial firms to do what they did first to the Internet and then to the overall economy, namely to hype them out of value and sink them hard for no reason. In simple terms what I am advocating has been done before and that is to separate trading from advising. The Chinese Walls in these firms never worked and never will.

Twitter

Twitter I use a lot, borth for reading and producing content. Twitter is like the newswire for me, like those news summaries that appear down below on CNN (or used to because I haven’t watch TV in so long). Twitter is great for breaking news.  Also for short interactions and some fun moments.  Twitter is trying to kill DM and that is bad, they should take out the 140 character limitation in DM so you can have deeper one to one discussions.  So you can combine the public with the private.  Twitter should also not count the characters of links to give you a few more characters for the occasional moments you need them.  The URL shortener war is absurd.

 Facebook

Facebook is only about friends for me, I used to have 4000 “friends” now I have around 600.  Sorry if I erased you.  But now I know almost all of them, if not in person at least virtually pretty well. Facebook is about more private things and I use “friends only” a lot. I know Facebook is dying to make money out of me showing whatever I post to anyone to get more activity and impressions. And the same is true for a lot of Facebook users.  So I battle Facebook on that and many times I lose and I am annoyed when a friend of a friend who I don’t know appears, even though they are mostly nice I should say.  In terms of politeness Facebook wins the prize. The only non private part of Facebook that I use is groups, and those work well to liaise along themes or narrow lines. What Facebook needs to come up with is a paid version like LinkedIn and show ads for those who don’t pay.  Also Facebook attempts in advertising have been clumsy so far.  Facebook thrives at connecting people but is very poor at trying to have them buy something. I would gladly pay $7 per month to give no incentive to Facebook to spy on me to sell me ads.

Google+

I use Google+ for drafts, I have an idea and I put a first draft on Google +, I then get criticisms, comments, and I improve or modify my original idea into something deeper, I do more research on my own and then I go to my blog, generally my English blog. Google+ has great ideas and a wonderful design on mobile.  I just wish more people used it as it also has no ads.

Tumblr

Tumblr (I am an investor) I use for shorter articles, I am also aware that what comes out in my Tumblr goes on Twitter as I have them linked. Tumblr is great to discover longer form and visual content. Their discovery platform is still poor but I know it will get better.  And what you find is just beautiful. Tumblr also lacks comments but that can be both a good and a bad thing. In the one hand you stay away from trolls and keep it friendly. On the other hand, the debate always ends up in Twitter and you can miss some interesting comments. And Tumblr gets some original content creators who are mostly there or just there. In Tumblr I follow photography, science, medicine. I used to use Tumblr as a form of self expression, I still do but now I love to discover what others have to say.  There is a certain level of aesthetics and professionalism in Tumblr that is missing elsewhere.

Pinterest

Pinterest I don’t get. I see it as closer to Tumblr but kind of messy. I don’t see a lot of original content producers there. It is more kind of “look at what I found Dad”. I am a father of 5 btw and I am used to this show and tell moments.  What I don’t like about Pinterest is that it is not about creating your own content.  I think it might have an utility as an archive for your personal findings on the Internet, which can be kept private. The Android apps for Pinterest don’t let you post, just look.

Path

Path I just started using it. It is very, very visual and I use it taking advantage of the camera programs in my iPhone and my Samsung Galaxy. I use it for great shots taken with phones. Shots that are the essence of the moment I am in, like a great tweet, but visual. I know you can do much more at Path, but I don’t. The people who answer me in Path I tend to know.  They are friends.  Path is actually very, very well designed.

Flickr and Picasa

Flickr I love but I have the feeling that it’s dying. Pity because there is tons of quality photography there and I am an amateur photographer. I use Flickr for the photography I do with the Leica M9 or the Canon 5D Mark II. Lately, I’ve been trying 500px and I think it’s the modern version of what Flickr should be. Their iPad app is great. Google+ photos formerly known as Picasa I use. I like the fact that many pictures go there from my Android. They also go to iPhoto from my iPhone the same way. Both systems are good for not losing pictures even though you have to erase many. I wish they would ask you if you want to update them.

Photo Apps

I love Snapseed on the iPhone and iPad.  It is simple, very well designed and you can take great pictures to post in social networks.  Instagram I use but sometimes with pictures I took with Snapseed cause otherwise all Instagrams look alike.  They do have a great community at Instagram also made of mostly nice people.

Social Video

YouTube is another beast. In the video world I prefer Vimeo. But Youtube has huge audiences that have given millions of views to my videos so I go on placing them there in spite of the horrendous, idiotic level of commentary. I have rarely seen a smart person commenting on a video on Youtube. Dante’s inferno said “lasciate ogni speranza voi che entrate” and that is today very applicable to the level of Youtube commentary. I many times just don’t let people comment on my videos in order to avoid racism and plain idiocy. Now Vimeo is another world. Vimeo is like Tumblr in video. There is amazing quality beautiful videos there.

Foursquare and Google Maps

Foursquare is so focused on the stupid game of being a mayor of your bathroom that you sometimes forget that it’s also like a Spotify for geographical locations.  It is interesting to find good curated lists of say restaurants in South Beach Miami. The lists have been enhanced in their latest updates. I use Google Maps a lot. In any case since I invested in Dopplr and Plazes I have always believed in the social value of city exploration and I know we will accomplish more in this area.  Google and Foursquare are half way there with different solutions for similar needs.

LinkedIn

Until LinkedIn invited me to write for the site I was using it little.  Fon was using it to recruit but not me personally.  Now that my posts get so much engagement there I find that with LinkedIn I can interact with the most educated audience of any site.  At least when focused on professional endeavors.

Messenger platforms

Is messenger social media? I think it is. Skype is social by nature, and I use it either in very intimate situations or non intimate at all, like job interviews. BBM I have with two of my children who are still on Blackberry and a few other people who have not given up. Whatsapp keeps me in touch with some others who are across platforms, it is uncanny how they got away with the fact that if you have somebody’s phone number you can Whatsapp without acceptance. It makes you want to get a new phone number so ghosts from the past don’t haunt you. SMS is rare for me. Google Talk and the Google + messengers I use but rarely, with an occasional friend who loves it. MSN or Yahoo I have not used for ages. Email I do use and a lot. I like the asynchronicity of it. I like Gmail, it’s brilliant.

Blogs

Blogs other than mine are also a way to be socially active, reading, leaving comments, and I do read a bunch of blogs, the best way to see what I read is still my Netvibes public page. All the RSS feeds that were kind of killed by Twitter but not totally for me. I love the way Netvibes presents all blogs in one screen for me in my MacBook or any PC. I read many professional blogs such as the Hipertextual blogs, or GigaOm.

My Spanish and English Blogs on WordPress

I try to keep a certain quality level in those blogs.  They are me so I better look good :).  I have apps for iPhone, Blackberry, to blog from other devices but I mostly blog from my MacBook and after testing the grounds on Google + or Tumblr.

Social News

In Spanish I love Meneame, in English Reddit.  Social news work for me as the wisdom of the crowds is actually a good editor and I frequently comment.

Social Music and language learning

Those and other formerly non social activities are also getting social, certainly music with Spotify which I use a lot and even language learning with Busuu.

Languages on Social Media

In my case there’s the languages issue. I write more in English because the best content on the web is in English. Spanish even though it is spoken by a great deal of people there is little new science or radical ideas coming out in Spanish. There are some, but few. I also understand French, Italian, Portuguese and Catalan. Catalan is to languages what Path is to social networks :) French is probably the other language were some original content is found. Less so in Italian and Portuguese. I am learning German, if I really spoke German I have a sense that there would be some more original content. But Germans and Northern Europeans in general have an elite who writes in English and that is great.

Gadgets and Social Media

There is another angle to all of this and that is that many social networks are gadget specific. Path is not on the web, the iPhone is great for photography. With the iPhone for example you can be in Instagram as well and I also post on Instagram. You can then post from there to Tumblr and other networks. Not to Google + which is trying to make it all with Google products (a mistake). I use the iPhone 4S, the Samsung Galaxy SII which is amazing, the new Blackberry Bold 9900 which is still the fastest small gadget in which to write and message but poor for almost everything else, the iPad which is perfect for looking at content, not so great for producing it. And then my MacBook Pro which is perfect for typing fast, for editing video, for editing photography.

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In 2007, Loic Le Meur and I came up with the concept of La Fatera. It is described here. The idea was a scale that would share your weight over the internet and help you lose weight socially. At that time the plan was that Fon makes the Fonera and the Fatera. But while at Fon we stuck with the Fonera, a successful strategy (this year alone we sold close to 2 million), others picked up on the concept of the Fatera. The most successful implementation is Withings the WiFi scale. And new social sites to lose weight keep appearing. Fatdrop is a good example.

The obvious reason for the success of the scale and the weight losing sites is the obesity epidemics. 20% to one third of the population of developed countries obese or overweight. Interestingly obesity is so global and popular that in the world now there are as many obese people as hungry people, an estimated billion of each. But other than obesity the psychology of overeating lends itself more to sharing the activity socially to stop it than other addictions. Drug addictions, alcoholism are generally treated in secret in places like AA because taking drugs alters your behavior and there is a shame factor associated with it. Few people tweet something like “I have gone 134 days without shooting heroin”. Yet many people are tweeting their weight with Bob Metcalfe the creator of ethernet is a good example. Over eating is an activity that can be done in public, without shame and that other than the occasional barfing it does not produce any obvious social problems (it’s legal to drive after you overeat for example). But in this case, the shamelessness nature of over eating is a big plus for society to get you to stop. And sharing your weight over the internet is the objective measure of your eating. I see tremendous potential in weight sharing as a way to socially lose weight.

A few years ago, Yahoo had an opportunity to buy Google for less than one percent of its present value and passed. After that, the company went from being poorly managed by Terry Semel to being poorly managed by Jerry Yang. Its shares went down to $19. At that point, Steve Ballmer and the Microsoft management team saw an opportunity to buy Yahoo for a reasonable price and gave it a try.

At the same time, Yang and the board members thought they could take advantage of a “rich buyer” and achieve through tough negotiations what they could not achieve via able managing, namely a high share price. They not only rejected the offer of $31, but asked for $37 or nearly twice as much as the share price was worth before Microsoft had first mentioned the word Yahoo.

Ballmer´s reply was simple “we may be rich, but we ain´t stupid” and ditched them. Those shareholders that had bought shares thinking the sale was a done deal were left holding the bag.

Icahn, an expert in takeover battles in the 80′s, threw himself into the battle without having experience with the Internet and started buying cheap shares with the objective of having Microsoft buy Yahoo! at $31 per share and go back home with $1 billion.

The rules of the board of Yahoo were favorable for Icahn. While most of the companies elect their directors and board members at different times, Yahoo elected them all at once and this makes it extremely vulnerable for a takeover. Icahn saw this opportunity to chose an alternative slate of directors and sent an aggressive letter to the board that is well commented by Kara Swisher, one of the best technology journalists so I link to her for this part of the blog post.

The guys at Yahoo replied with this letter saying that they did not want to give Yahoo away to Microsoft and other weak arguments, as it is hard to explain to shareholders why $25 is higher than $31.

Now Yahoo shareholders have only bad choices left. They can vote for a management team who had a chance to buy Google and passed, who had a chance to sell to Microsoft and passed and who had a chance to dominate the internet a la Google and failed. Or alternatively they have the opportunity to vote for a corporate raider who knows nothing about the internet and who´s only strategy is to sell to Microsoft. Will there be another unexpected buyer such as large global telco in the meantime? Will Yahoo find a way to divest of its Japanese and Chinese properties and raise $20bn + in cash? Will the current Yahoo board bring a stellar CEO and win the election? All these are possibilities that do not escape Icahn, who is convinced that one way or another he will make money with his Yahoo shares.

There are many reasons why I believe that Facebook will be worth over $10bn, maybe as much as $20bn but I will focus on one, its open immigration policy. Joanna Rees (CEO of FON USA) and I went to see the folks at Facebook in order to make a deal on how Fon could appear in Facebook. The visit was amazing in the sense that we basically learned that we could do whatever we wanted at Facebook. All our ideas were greeted with a yes, yes and yes.

Basically, the Facebook system resembles a country with open immigration in which the best are allowed to thrive, kind of like USA who manages to attract the best of the best…and thrives. But of course you have to live by certain rules like for example disclosing who you are, a rule that we also have at Fon and that while potentially hackable Facebook told us that they frequently delete accounts of people they believe are not disclosing their true identity. Interestingly Second Life has the opposite principle, namely that people would like to live in an imaginary world of second identities, and some do, but most like to have a real relationship with real friends.

To me there´s no doubt that Facebook will be hugely popular and will overtake Myspace sometime during 2008 and become the largest social network in the world. The only lingering doubts center around monetization but with Google nearby and with the famous Myspace Google deal as a starting point I see that selling ads to people who disclose their identity and so much about themselves will be like shooting fish in a barrel.

There are many reasons why I think that Facebook will become the number one social network in the world and eventually surpass Myspace.com. One is that it has managed to integrate a developer community of apps that is unrivaled. Two is because, as opposed to Myspace, it managed to span accross generations going all the way from teens to baby boomers. Three is because it allows for many different levels of involvement. The only limitation I see is the language, that it´s only in English.

Last night I was having dinner with C.J. Cherng, the very able CEO of Taiwanese ISP Seednet, a Fon partner. During dinner we were talking about how global the Internet is and yet how different local rules are for ISPs around the world. On one side, there´s the US, who invented liberalization and, after being successfully copied by the whole world, retreated into a duopoly situation that is hurting the US consumer. On the other, there´s Europe, which implemented unbundling to such an extent that now European ISPs are the most competitive in the world. ISPs, like another Fon partner Neuf in France, have a menu of choices that would make any American forget about French rudeness and want to move there. For around $40 you get free national and international long distance, up to 20meg download speeds, a TIVO like service, cable TV channels, storage, mail, etc. And if you are an Internet fan and you happen to live in Sweden, then Labs2 offers you 100MB both ways for 89 euros a month.
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Because American education stimulates creativity and self reliance.

Because Americans have a huge homogenous home market in which to test their product.

Because American culture is the only global culture.
Read More

Here´s an idea for my friends at Google. It´s called RANDOM GOOGLE. We all love the google ranking algorythm… but sometimes it is useless. For example, let´s say Al Gore, tired of seeing hurricane after hurricane hit the States as a result of global warming, wants to run again as the “environmental president”. The people who run his campaign would like to have a way of “polling” google. They would like to search for “Al Gore”, but this time they want to do away with Larry´s famous algorithm. Voting is not a ranked activity (and there are many who aren´t). Voting is one person one vote. So what the pollers want to know is how popular Al Gore is in Google, posting by posting. What the campaign manager wants is what I call the RANDOM GOOGLE button. What would RANDOM GOOGLE do? Basically give you a random string of say 100 results. Pollers could then read them and classify them as pro Gore or anti Gore. In other words, they would poll Google provided that they have a Google without the ranking. They could search random strings by quantity and time periods. From Google´s point of view, the Random Google button would greatly increase ad servings. People would search a term and then random Google it. Maybe more than once. And they would randomly learn about their search term being more frequently exposed to google ads.

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