Onion Sends Apple Up with the MacBook Wheel
This is just too good to not post.
This is just too good to not post.
In Media Metrics: Hate to Burst Your Bubble, John Gerzema discusses the erosion of the power of branding. In the process he makes an interesting observation: many companies have capitalized their brands, and they carry them on their books at considerable values. If these brands are in fact not worth anything close to the value they’ve been assigned, then there’s another financial crisis on the horizon.
Gerzema is writing from his perspective as “Chief Insights Officer” at Young & Rubicam. As soon as I stop chuckling at this utterly ludicrous title, the observation is that as a member of the industry that has created and perpetuated the myth of brand value, his take is bound to be somewhat biased. This is the industry that has for decades convinced otherwise rational executives to spend stupid amounts of money on an intangible concept while simultaneously convincing them that the result is a capital asset.
Now certainly it can be argued that a brand has some value. Awareness of a product is linked to the selection of a product for purchase, without question. But the brand itself is still intangible. The value of a brand should be measured as the cost of changing it. As an example, let’s say Pepsi decided to rebrand itself as “Foo”. There would be considerable cost and significant time involved in doing this, but it’s possible. With some tired brands (Levis comes to mind), it might even be advisable. This cost of rebranding is the true value of the asset. My bet is that the actual cost is considerably less than the asset value on many balance sheets. In his article, Gerzma asserts that “brands account for 30 percent of the market capitalization of the S&P 500, or almost $4 trillion dollars” (without citation). That’s one heck of a bubble.
In discussing the extent of the bubble, Gerzma writes “Further signs of this worrying disconnect emerged as we examined the extent of the gap between business and consumer perceptions of brand value”. What’s funniest there is the phrase “worrying disconnect”. To me it seems like a “reconnect” between consumers and reality that can only be worrying to big advertising agencies and to CFO’s with overvalued brands.
All that money companies have poured into ineffective marketing efforts — driven by “gut feel”, and marked by a complete inability to measure performance in any truly analytical way — is money thrown away. It’s lost, it’s gone. We have tools that measure the effectiveness of most of these things now in hard numbers, and the brand game is up, it’s done.
Still someone with a “CxO” title at a major agency has a responsibility to evangelize for his industry, be he right or wrong. He applauds the performance of brands who are “innovating beyond advertising”, such as in product development, corporate social responsibility and sustainability”. I hate to break it to him, but in these cases the brand is just an identifier that links a consumer to an enterprise that is doing these real, tangible things such as producing good products in a responsible way. Now there’s an insight!
Gerzma wraps up his weak argument that big agencies somehow still have a purpose with “today, everything is marketing and only creativity matters if a brand is to hold its value in this rapidly transforming and unforgiving marketplace.” This is a complete and utter contradiction of the reality that he has observed but still cannot accept: good products and good service are everything, and marketing is in large part the process of communicating the good things you do through various channels. Worse, some channels cannot be controlled, such as social media.
The days of managing a message through monolithic media are long gone. Now it’s about doing a excellent job and getting people to talk about what your organization does in a genuine way. Social media can be influenced, but ham-handed attempts to “manage” it are almost certainly destined to end badly. If I was involved in a big advertising agency, that’s the bubble I would be most worried about. That and keeping my resume up to date.
A comment from my last post asked me to back up the claim that settlements have lent weight to the validity of the GPL. I got some feedback from a friend and did a little research of my own and here’s a summary of the stuff that’s easy to find.
The developers of Busybox have been busy indeed:
March 6, 2008 BusyBox Developers and High-Gain Antennas Agree to Dismiss GPL Lawsuit
March 17, 2008 BusyBox Developers Agree To End GPL Lawsuit Against Verizon
July 23, 2008 BusyBox Developers and Supermicro Agree to End GPL Lawsuit
October 6, 2008 BusyBox Developers Settle Case With Extreme Networks
The GPL Linux Kernel has been defended in a European court verdict.
Many other successful settlements in favour of the GPL are available at gpl-violations.org.
Groklaw’s article “A GPL Win in Michigan” discusses how the US courts have found the GPL enforceable.
Sun Microsystems gets the GPL, even if it doesn’t suit them. in a CNET article from 2005, Jonathan Schwartz is quoted as not liking the GPL because of “the GPL provision that says source code may be mixed with other code only if the other code also is governed by the GPL”. Sun’s rather formidable legal team gets it: you can’t mix non-GPL code with GPL code and still comply with the GPL.
This is just the beginning. The SFLC has launched a suit against Cisco on behalf of the FSF. SCO descends further into bad joke status by attacking the GPL, with IBM on the other side. Any bets on who will take that one?
On the flip side, there’s nothing I could find where a challenge to the GPL was successful.
Back in June of 2007, the Joomla project generated a community firestorm by announcing that, based on legal opinion, it felt that all Joomla extensions were required to be released under the GPL and that it would start to encourage third party developers to comply with that interpretation.
Detractors tried to paint this as some sort of policy decision. Somehow they never quite grasped what was being said, so I think it bears being repeated. Open Source Matters, Inc. (OSM), the non-profit charged with protecting the interests of the project, sought and obtained an opinion from legal experts well qualified in this area. Their opinion was specific, clear, and — this is critically important — while not based on precedent set by court decision, was based on several lawsuits that were settled just before going to court.
This needs some elaboration to make it as clear as possible: businesses who thought that this interpretation of the GPL was wrong, and who distributed proprietary attachments to GPL products, backed down when faced with going to trial. In my opinion, the only reason why a commercial enterprise would elect to settle a case of this nature just before going to trial is because they knew that they were likely to lose. When several suits get settled this way, all in favour of the GPL, they begin to carry significant legal weight.
So OSM had two choices: communicate the requirement that extensions be GPL or adopt another license. Considering that Joomla formed as a direct result of the actions individuals who believed in the GPL, there was really only one alternative.
Free Software — as defined by the GPL — may embrace open source, but it is not the same as open source. It is designed to give users rights and freedoms that go well beyond access to the code. For developers the interpretation is simple: get on board or use code that has a different license, period.
At the time of the GPL announcement, I had decided that Joomla was the best CMS for my web development business. I had just begun to get involved with the project, and had at best contributed a patch or two. As a small business, source code is our biggest asset and I will admit I had some concerns about giving up the ability to protect that asset. But at the same time I am not so hypocritical that I think somehow we have the right to protect our code, while using hundreds of thousands of lines of code written by others without compensation.
A few days ago, the project announced that the Joomla Extensions Directory was only going to list extensions released under the GPL (JED to be GPL Only by July 2009). Predictably, this has created another round of controversy.
The difference here is that while the original position was based on legal opinion, this decision is more one of policy. The project is choosing to not promote extensions that violate the terms of the GPL.
When the first announcement was made, my Joomla involvement had just begun. Now, I’m one of the more active members of the project and part of the Development Team. While not part of the Core Team or OSM Board, which are the bodies responsible for the governance of the project, I have made some significant contributions. Every time someone downloads and installs Joomla, they benefit in some small part from my work.
It is in this context that I’m going to respond to several reactions to the JED announcement:
Reaction | Response |
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Joomla needs commercial extensions in order to survive and gain acceptance from business customers. |
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I can’t make money if my extension is GPL. |
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Policy makers in the Joomla project are out-of-touch idiots and something should be done! |
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Someone will fork my code and release a better version three weeks later. |
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From my viewpoint, a great part of Joomla’s success has been as a direct result of its commitment to empower the end user via the GPL. Moreover, the principles of the GPL have attracted much of the talent that the project currently has. I see companies that don’t embrace these values but who continue to earn a living thanks to the project as nothing more than parasites. I’m certain that once the leeches have been pried from the JED, it will grow more quickly and become more vibrant than ever before. Time will tell.
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