timone NetMarketing
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Marketing in the Internet - as seen from Italy

by Giancarlo Livraghi

No. 26 - September 18, 1998

  1. Editorial: The un-level playing field
  2. Choise by fear
  3. A map of the net
  4. About "projections"
  5. Italy: the bright side
  6. Italy: the dark side
  7. The meaning of "piracy"

red buttonSummary

1. Editorial: The un-level playing field
I’ve been reading and hearing a lot about a level playing field. That’s an important and interesting concept. It can (maybe should) be analyzed in many subtle ways. It can lead to some broad considerations about things in general and (more importantly) to a specific analysis of each individual case, to improve quality and efficiency.

In general – it’s utopia. Of course there’s nothing wrong with utopia. An "ideal" objective is, by its own nature, unachievable; but without it there can hardly be any progress, improvement, innovation or motivation.

In practice, there is no such thing as a level playing field. It may be possible (up to a point) in an artificially constructed environment set up for a sports event. But even in those controlled conditions it can’t be perfect. The performance of each individual athlete can be better or worse depending on climate, temperature, atmosphere... some may do better in total silence, others with a cheering crowd... even an apparently "abstract" game, such as chess, is environment-sensitive.

Out in the wild... life, society, business... fields aren’t level. I think understanding how and why a specific field is un-level can be quite important.

I know this is an over-simplification, but essentially there are two possible ways of handling a non-level playing field.

One is what I call the Caius Duilius approach: changing that part of the environment to turn it into a playing field that is slanted in our favor.

The other is choosing the "playing field" in which our abilities, experience, resources and tools give us the best competitive edge.

Here again, the analysis can be quite complex. History, anthropology, biology, ecology.... many sciences must deal with this problem and can help us to understand it (and so find the solution the best fits our needs).

To put it simply: an effective strategy is often a combination of the two approaches. But the "Caius Duilius" way contains some hidden risks. I don’t think it’s necessary to explain why trying to "force" the environment can be quite risky. The field that we think we have "leveled" (and slanted) to our standards can hide all sorts of unexpected bumps. In this way we can produce a "pressure cooker" that sooner or later will explode. There are countless examples of this happening, and the damage can be fearsome. The other approach... riding the tide, catching the flow, choosing the eddies that can bypass an obstacle... may be a bit more subtle, needs experience and sensitivity. But if well done it’s very effective.

So far, I have deliberately avoided mentioning the net. None of this is new. The problem has been with us since the beginning of time – regardless of which communication tools we are using. But it’s no coincidence that the idea of a level playing field comes up often when discussing the net.

Is the internet the ultimate "level playing field", where we all have the same "share of voice" and the same opportunities? In theory... maybe. This is a "useful utopia" and I don’t think we should lose sight of it. But it’s not as simple as it sounds. I must admit that in those remote days (four or five years ago... it feels like a lifetime) when I started to concentrate on these matters I fell into the trap of confusing my hopes and desires with reality. I must admit, with some disappointment, that what I have learnt does not lead to the conclusion that we have a "perfect" environment offering equal opportunities to all. It’s a multitude of different playing fields, each of which is not "level". On second thought... maybe that’s not so bad. An extremely (and growingly) complex web of different playing fields may offer more opportunities than one big arena, that by trying to accommodate all is too neutral to fit anyone. Diversity can be more fruitful (and more fun) than an endless, boring flatland.

This, I think, leads to two types of consequences. One very broad and general, the other very specific. One is that many problems in our world are better solved (and many important innovations can be generated) by a multitude of micro activities and initiatives than by large-scale handling of macro situations. And this poses some serious questions on how "globality" is being managed...

The other is more immediately relevant for those of us that aren’t trying to run the world but simply to manage a business or an organization. Fields aren’t level; but we can choose the field rhat is slanted our way – that offers the best opportunities for us, where we can best apply our abilities.

The net is a tool that multiplies the opportunities of finding and choosing the best playing field. There is a metaphor that makes me uncomfortable (because it reminds me of small and vicious German battleships in World War Two: wonderful machines with great crews, but used for a nasty purpose). But it’s true that the net offers great opportunities for pocket-size multinationals.

Not in all playing fields... some, even in the net, are best fit for the large organizations, the so-called dinosaurs.But there are many that are ideally suited for the squirrels   – and more to come.

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2. Choice by fear
Some readers have asked me to comment further on the subject of survival  – or the dangers of defensive decisions. I’m pleased to do so, though it’s not easy to cover this subject in a few hundred words.

There is a vast literature on this subject. I find particularly interesting those studies that concentrate on desire, aspiration, self-fulfillment. Trust your hopes and not your fears said a christmas card that someone sent me when, as a fledgling newly appointed manager, I was trying to cope with a company in very poor shape while suddenly its international parent appeared to be on the verge of bankruptcy. So I did (also because, under the circumstances, I had no other choice). It worked. A few years later the local company was in very good shape (and the worldwide group was recovering quite nicely). The risk was high; but in the results (that unfortunately come after decisions) proved that a defensive strategy would have lead to catastrophe.

As David Ogilvy used to say, the worse risk is to run no risks. I can’t think of any successful enterprise, in politics, culture, science or business, that didn’t run some very serious risk at some point in its history. But those risks that we choose to run aren’t half as dangerous as those that we stumble into because by locking ourselves up in a defensive attitude, by running away from anything that we find concerning or scary, we overlook a precipice.

Of course looking out for dangers is necessary. The bravest people in history (as well as in novels and movies) say if I didn’t know how to be afraid I’d have died a thousand times. But if "being afraid" means hesitating, looking for "comfortable" decisions instead of the effective lines, avoiding responsibility... it’s one of the most devastating sources of mistakes and disasters (especially when combined with that other evil power, stupidity.)

This is particularly worrying in the case of new technologies (or any unfamiliar tools). Nobody wants to admit it, but the biggest problem in information technology is that people (and even more so companies) buy things that don’t fit their needs. The reason is fear. They buy, or update, not because they have a clear understanding of what they want, but because they are scared. Am I going to be lefty behind? Will my competitors get ahead of me? I don’t understand what these things can do for me, but can I survive without them? Yes, things gave changed over time; technologies are no longer so remote and so poorly understood. But this remains a messy, murky market, with too many smokescreens standing in the way and too many so-called innovations that are useless, if not a nuisance, for most people.

Beware of fear. It’s the main reason behind that absurd behavior that I have mentioned several times. Choosing a solution before we know which is the problem; choosing tools  without knowing clearly enough what they are for. The results are sorely visible.


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3. A map of the net
The distribution of the net (which is far from "global") is pictured in this map; a simplified version of a the one in Cybergeography. It’s dated 1997, but things haven’t changed much in the meantime.



Click here for a larger and more detailed map

Most of the network connections are in North America or Europe. Of course we must expect deserts, or sparsely populated areas, to be empty. But this map would look quite different if it represented density of population.

Since the beginning (twenty years ago, or more) of discussion on the "information society" it was quite clear that new technologies could open new horizons for freedom, wellbeing and civilization – and therefore new markets. The widespread use of technology has been growing much faster than anyone could imagine. From the "information society" we are already moving into a further stage, the network economy. But 98 percent of the people are excluded. We are a long way from achieving what is practically possible, but so far hasn’t been done.

It’s obvious that information can’t solve all problems. If people are hungry they need food; if they are thirsty they need water; if they are sick they need treatment; if they are being killed or maimed they need to be physically protected from the murderers. But information can be extremely important in understanding problems, managing solutions, and putting countries and communities in a position where they can manage their situation and be less dependent on things decided somewhere else. It’s really depressing to see how little is being done to help the "information have-nots".

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4. About "projections"
I’ve always said that I don’t believe in prophecies  and that I don’t make any. But I must admit that it amuses me to go back and look at one of the very rare occasions in which I dared to make a "projection". At the end of 1996 I worked out an analysis, that was published in a book the following year. It’s represented in this graph.



In those days there was general agreement on two projections.

The first said that there were 25 million internet "users" in 1994, growing 15 percent a month. A few keen observers noticed that a year later they were still supposed to be 25 million, and still growing 15 percent a month. But nobody stopped to look at the consequences. Had that been true, internet "users" today would largely outnumber total world population. That’s (more or less) the red line in the chart.

Another projection, also widely accepted, said that there would be one billion net "users" in year 2000. On that curve, there should be around 250 million people on the net now, while the most "optimistic" estimates are just over 100. That is (approximately) the blue line on the chart.

I said then that it was more likely to have an irregular development, with ups-and-downs (as has happened) and that it would fall in an area that (obviously) would widen, i.e. become less precise, with time. That’s the green area in the chart.

Now... current estimates are "more or less" in the yellow circle in the chart; and the growth pattern is "probably" placed in the yellow area on the right of that circle – unless something quite unexpected happens (as it did more than once in the past).

Apparently... I wasn’t much off the mark. But they key point here is not whether I "guessed right" or not. It’s that all projections must be taken with a very large pinch of salt -– if not ignored altogether.

As we all know, the net has been growing remarkably fast. But not in the way that everyone believed in those remote, primitive and forgotten times – two years ago.

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5. Italy: the bright side
Without getting into a lot of complicated number-crunching, at this point I think it’s true that approximately 1.8 million people in my country have access to the internet. A small number compared to more advanced countries, but much larger than it was a year ago. With almost 50 percent growth in the last six months.

We are still far behind the level that we need to be competitive. But, at last, Italy is on the move. If this trend continues, we could be "where we belong" in three years.

This is the hostcount at the end of August 1998, according to RIPE, for the 11 European countries that have more than 200,000 internet hosts

Internet hosts in Europe

Countries with over 200.000 hosts
Source: RIPE Réseaux IP Européens September 5, 1998

% change in August % change in six months
Germany 1,362,940 + 4.1 + 17.2
United Kingdom 1,348,479 + 2.0 + 20.7
Netherlands 518,964 – 2.7 + 26.7
France 454,096 + 1.6 + 13.6
Finland 448,705 + 2.3 + 8.7
Italy 397,724 + 11.1 + 48.2
Sweden 396,244 + 7.8 + 12.4
Norway 309,993 + 2.5 + 1.6
Denmark 274,724 + 37.1 + 52.9
Spain 259,350 + 0.5 + 27,9
Switzerland 215,786 – 0.6 + 8.6
Europe 7,250,734 + 3.8 + 18.8

Germany overtook the UK slightly this month, but of course Britain remains in the lead if we consider density. Denmark’s "leap" is so fast in one month that it could be a technical adjustment; we shall see in the months to come if it’s just that or a trend. The "saturation" that I thought I was noticing in past months isn’t quite there: of course high-density countries have lower growth percentages, but if Finland is till growing that shows that we are not near "saturation" – even within the limits of the net as we know it now. In the case of France, the minitel is not considered. The (serious) efforts of the French government to switch the traffic to the internet have not yet achieved major results; it takes time to change deep-rooted habits.

This graph shows the growth pattern of Italian hosts from August 1997 to August 1998.

Internet hosts in Italy – August 1997 - August 1998

Source: RIPE Réseaux IP Européens


This graph shows the percentage of Italian hosts on the European total from August 1997 to August 1998.

Internet hosts in Italy as % of total Europe

Analysis based on RIPE data


This percentage must (at least) double to bring Italy’s presence in the net in line with its role in the European (and world) economy. If the current growth trends continued, that could become possible.

The next graph compares growth in Italy and Europe (1997 = 100.)

Internet hosts in Italy and in Europe

August 1997 = 100

Analysis based on RIPE data



After a period of weakness, Italy is catching up.

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6. Italy: the dark side
Some people say: It doesn’t matter if people get on to the net in the wrong way or for the wrong reasons, and do silly things. What matters is that they become familiar with the environment, then they will find new ways.

That makes sense – up to a point. Malgré tout, they say, the net is growing. So be it... but malgré tout can’t be a reasonable strategy for government, parliament, the administration and the press. They have bigger responsibility than a new user finding his or her way around.

The list of things they are doing to screw things up is appalling. Poor legislation, messy regulations, and a constant flow of grotesque and terrifying news.

"Bad press" on the net (be it fear-mongering or silly exaltation) is a worldwide problem. But it seems to be considerably worse in Italy than in most places. For instance a recent crackdown on people collecting "offensive" pictures involved five people in Italy, 200 in other countries; but only here the press coverage was out of all proportion... leading front-page headlines, peak-time tv news, etcetera.

Some of the brightest business people are beginning to understand that this is not just a problem for society, family, education etc. It’s also a problem for business.

I am keeping it short here, because I guess international readers are not interested in the details. There is much more information (and comment) on this unpleasant subject in the Italian version of this newsletter.


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7. The meaning of "piracy"
I’ve said several times that new words (such as hypertext) are fine, when they have a precise and relevant meaning; but are a problem when they mean nothing, or several quite different things, and get in the way of understanding what we are talking about.

If we could get rid of confusing words such as "virtual", "multimedia" and "cyberspace" we would have made a step forward in cleaning up some of the mess.

But there is another word that is causing quite a few problems. Piracy. That’s a very precise world, in common use as well as legal language. It means armed robbery, often murder, at sea. And unfortunately it’s not "a thing of the past".

Now it’s used to mean lost of different and unrelated things. Hackers, as we know, are not "pirates"; and even "hacker" has several different meanings. To make things worse, "piracy" its used also to mean people who trade in copied software; or people who do nothing of the sort, but simply are using software without satisfying all of the (often unfair) clauses in the manufacturer’s fine print. This becomes quite grotesque in a country where an absurd law makes that a criminal violation (though luckily some judges have understood how ridiculous that is). I have no sympathy for virus spreaders, but it’s pathetic to see serious reports about jet another form of so-called "piracy" based on one of the countless spoofs (believe it or not, there were alarming messages by major trade associations to their members, and articles in newspapers, about terribly dangerous devices called "good times" or "penpal greetings").

It’s bad enough to have the press talking about a variety of "pirates" to such an extent that parents are having nightmares about Captain Hook jumping out of the computer and killing their children, or whisking them off to Neverland. But it’s even worse when police officials use this illegal and absurd language, and people have their computers seized, and go through all sorts of legal trouble and other discomforts, just because maybe a teenager had a copy of a videogame and couldn’t prove that he had bought in a store.

This, too, is a problem for all of us (including business); not only for the victims of harassment. I think everyone involved in the net, for business, work, study or fun, should be concerned about these problems – before they get even worse.



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