Why in the world are we paying for Social Text?
So I’m involved in a class where we have to write a group paper. We all know the drill, everyone comes up with an idea, writes their section and then copies it together into one gobbled mess that doesn’t make sense. Last night we were sitting around and talking about e-mailing versions around to each other. Someone thought, “well what if two people make changes to the same part? What if the transitions don’t make sense anymore?”
Then it hit me…. WIKI PAGES!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!! What a perfect collaborative tool. We can all go in, make our own edits, and not have to worry about e-mailing new versions around every time we correct a grammatical mistake. My initial excitement was replaced with the realization the Social Text costs $$. It didn’t seem worth shelling out $ or setting up a trial period for a paper that was due in 2 weeks.
Turns out, you can create a Wiki page for free and it is easier than setting up a blog. In fact, the one I found (Wikidot) seems to have better editing features than social text. There is even free wiki software!
This led me to wonder, why on earth is BC (or anyone) paying for Socialtext when they can get a lot of the same capabilities for free!? Sure, Socialtext has a lot of bells and whistles, but how hard is it for the opensource community to add a Facebook feature to a Wiki page? This stuff isn’t brain surgery here folks, and I feel it is only a matter of time before groups like Wikidot catch up to Socialtext and say, “our Wiki pages are identical to theirs, and they’re free. Frankly, we don’t care if you use it or not, but its out there if you want it.”
I wish Alan were back, because I’d love to ask him how they hope to sustain revenue when their competition is free and they don’t seem to have a sustainable competitive advantage (RBV, right?). I fear they will go the way of the AOL’s and I would love to hear him try to convince me otherwise.
Here is a video preview:
Great comments… I expect this is why socialtext is moving from “just wiki” to an expanded business communication portfolio. Their competitors are low-cost/no-cost wiki platforms. They are looking to add value with the new gadgets, that can’t be easily replicated in the no-cost platforms.
I definitely agree that their success will rely not on their ability to show the value of a wiki, but in showing the value of wiki + social networking gadgets, and I think that was lacking in the presentation we saw. I am sure they have a strategy, but unless their goal market is new graduates in software start-ups, they need a coherent customer marketing pitch that says how they can improve business functionality (other than being able to spy on people, or twitter about getting a snack from the vending machine) with their new widgets.
If you want quick and easy wiki-like functionality for classmates I’ve used Google groups for MP1. You can make the group private and the Pages feature allows for people to edit a document like a wiki page.
If you think Wikidot is great, then Deki will blow your mind to Mars and back
Interesting that the founder and CEO of a company, MindTouch, is patrolling random blogs (most likely searching for Wikidot) and inserting his own advertising… another good tidbit for class discussion.
I suspect that a lot of companies who want to take advantage of wikis will pay for the security Social Text offers over freeware. The collaboration features that differentiate ST from other wikis are probably the icing on the cake.
Hi DC. “I wish Alan were back”, well a) I’d be happy to return anytime, but b) Through the marvels of the web, I’ll try and provide some responses here!
I can understand your comments based on the current experience you have with Socialtext, that being just using wiki pages. Socialtext only recently released People and Dashboards, and I don’t believe they are being turned on for your class until the current assignments are done. So a great deal of what you saw me demo, is not what you are experiencing.
If all you want is a group editable web page, then yes, there are literally dozens of free or open source wiki vendors available to you. Many of them are very good.
Where Socialtext’s value proposition comes in is being much more than just a wiki vendor. If you want the integration of attention management (which is HUGE for most companies that are flooded with information), group collaboration, and discovery of content and subject matter expertise, than cobbling together solutions from multiple vendors is not going to get you the seamless, secure, and intuitive experience that we offer.
Additionally, customers love dealing with Socialtext because of the assistance we provide in getting them up and running, and on driving user adoption. You being one of the best and the brightest in an MBA class may not require that same level of assistance. However, I can guarantee you, most employees inside enterprises do.
For the most part, our competition is not free, as we don’t see the free wiki services as our competition. That is like saying Gmail is competition for enterprise grade email, where it very clearly is not. It does fit some needs, but it does not replace something like Lotus Domino or MS Exchange.
The web has certainly changed the business model for selling software. You have to show value, innovation, and security, or companies will not use your product.
Not a single customer that I work with would consider using something like Wikidot over Socialtext, when it comes to doing real business transactions.
There you have it, my attempt at convincing you otherwise.
Alan- thanks for your reply. It was that value proposition that I was looking for. I was sitting in your presentation thinking a high schooler could add Facebook widgets to a wiki page, but I can see how your bundling, customization, and security could be a value add. I still wonder how much longer you will be able to rely on these talking points. What if a group like wikidot allows you to run the wiki within a company’s firewall? That sounds secure. What if the next wave of teenagers moves from html writing and picks up wiki customization? As for bundling, I think open sourcing could take care of that aspect. Keep in mind these are spur of the moment thoughts from someone green to the web 2.0 world, however, as someone who works in the private equity/venture capital area, I have trouble seeing the long term value.
I appreciate your thoughts on this, and I can tell you, they are similar to what has been said for a decade about all the other software I have worked with. Why would anyone pay for email, there are free alternatives? Why would anyone pay for instant messaging, they are free alternatives? Why would anyone pay for an office suite, they are free alternatives? Businesses don’t think like consumers. Enterprises want to purchase from reliable vendors, who offer support, stability, administration, advice, expertise, consulting, etc. The web 2.0 trends are no different. You get what you pay for.
Thanks for contributing Alan, from your viewpoint of a business application supplier, how would you differentiate your Enterprise customer from a normal consumer? And how does this distinction effect the product you are selling?
It seems to me that you are incorporating tools/widgets that have become popular to normal consumers, who have adopted these for personal consumer reasons. If enterprise customers or users have different characteristics in an organizational behavior way than ordinary consumers, how are you addressing it? Is it your view that the organizational behavior/communication of companies will shift to mirror that of early web 2.0 adopters?
Home consumers don’t worry as much about regulations, audits, compliance, reliability, backup, etc. The consumers are the users at the company, but the purchasers make decisions based on enterprise needs. Take for example how many companies ban Facebook and Myspace, even blocking it at their firewalls. However, they all want that style of functionality brought inside their firewall so that their employees can benefit. This is exactly the same as what happened with email, then chat, then blogging. Consumer adoption drives enterprise adoption. Look at the iPhone. Everyone has one at home, but very few companies support it as part of the enterprise architeture. That will change.
I both agree and disagree with Alan here. Disagree in the sense that I think some “free” sites are competition – namely, Google. Many companies have precisely moved away from enterprise level email hosting, and routing their corporate email through Gmail. I think there is a real danger here that Google sites (Google’s free wiki platform) could morph into a similar competitor.
On the other hand, my experience with SocialText is that they tend to be fairly proactive in platform development. Just as I wish that ST had a feature, it’s not long before it appears (of course, I’ve been asking for the ability to “rate” pages for years now to no avail). I also agree that ST is a very “user friendly” experience. They do a good job at hand-holding, which is required for the short term adoption of these tools. If ST continues to hand hold and use those opportunities to respond to customer concerns by adding new features, then they could stay one step ahead of the Googles of the world.
It might never become a $50B company, but by pushing the envelope on group collaboration they can might find a good niche that they can ride for many years. We’ll see.
What they really need to do is hire me as a consultant to go into companies and give my dog and pony show on group collaboration. Maybe if they reach their first billion.
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Why in the world are we paying for Social Text? « DC’s Blog « Prof Kane on Computers in Management said this on October 29, 2008 at 10:15 pm |
I forgot to mention, take a look at analyst reports from Forrester, Gartner, Aberdeen, etc. on enterprise spending on “web 2.0″ technologies. You’ll see that online document collaboration, dashboards and widgets, and social networking and profiles raise to the top of company priorities.
Alan et all,
I feel Social Text has shown value through the client relationship value add. For example, you have come back to our site and helped us in our discussion. If I posted about any other company, take Dell, Pepsi or Apple even, I doubt we would get a response so quick of a response (perhaps due to lack of red tape in a smaller organization, but it’s great to see).
Thank you for your time in presenting. As I was originally a web 1.0 person before the class, I felt you were able to present well to the web 3.0’s and the web 1.0’s.
Best of luck and thanks again!
Alan, can we take the fact that you submitted your last comment at 12:37am as evidence that web 2.0 tools have enabled your love of SocialText(work) to take over your life?
I hope your boss takes note.
LOL!