Feature Not A ($150 Million) Company

One of the more interesting ideas raised at the nextNY BizDev2.0 conversation was “feature not a company”, Chris Fralic of First Round Capital brought it up as one of the criteria they are constantly applying to potential investments to try and differentiate businesses from widgets, firefox plug-ins and clever web-apps that offer utility but do not scale (scale to what? seems like the basement is 50K users and 1M (no link!) is the “most likely to be acquired” tipping point for even $0 revenue services… and for everything in between? I’d wager it’s a power law based on your ability to monetize) or have very limited/no monetization potential.

So today I found this nice post-mortem on the ESPN Mobile service from Shelly Palmer, which neatly demonstrates that nice design, interesting features and a lot of money don’t matter when there is no perceived value.

People do not need to (nor will they) change their behavior to accommodate technology that does not solve an actual problem for them. The service was a parlor trick, a tour de force in programming for a new medium, fun for a few minutes, then ultimately useless. Which brings me to the second more important point.

Everyone in all three target groups already had a phone, so the offering would have to have included all of the services of a “best practices” full-featured cell-phone plan, plus a service that was so meaningful to target customers that they would be willing to pay the upcharge. As we can see from the actual statistics, ESPN could not find anyone to sell these features to.

The overwhelming lesson from ESPN Mobile has more to do with sociology than it does with technology. Features without demonstrable benefits (real or perceived) do not a business make.

If you want more from Shelly, check out Media 3.0 on NYC TV, looks like it could generate some interesting conversations on television’s struggle to stay relevant.

About Jonah

Jonah Keegan helps companies manage pay-per-click marketing on Google, Bing, and Facebook; produce web content; conduct market or competitor research; and setup analytical systems to measure marketing yields. You can learn more at http://www.clicktruemedia.com/

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