Are you kidding me?! That was pretty much the reaction of the BBC reporter when he dropped that number in an interview.

Let’s put that in context. In the San Francisco Bay Area, the fourth largest media market in the US, the leading radio station, KCBS 740AM, has approximately 650,000 listeners. And a listener is someone who tunes in for “at least five minutes, once a week.” To build that audience takes radio personalities, reporters, meteorologists, helicopters, producers, studios, transmitters and so forth.

And to PodCast? A thousand dollars worth of equipment, access to a broadband line and a bunch of bandwidth. Who has even heard of PodCasting? It has been around for three months.

It will not take much sponsorship to turn this into a profitable business. And think of the upside - your reach is not limited by your FCC license. In one of his hard edged businessman moments, he drops a few other data points - 592 PodCasters in his directory, 6 million iPods sold, and soon 600 million MP3 capable mobile phones all looking for content. Then he moved on to the tap-dancing PodCaster news.

So consider that before you get caught up in the latest speculative radio frenzy.

hotel 2

Originally uploaded by macarlso.

Over the holiday I read the first half of The New Normal by Roger McNamee. Interesting book – I will write a little more when I finish it. One of his points is that church, employer and government has fallen short of expectations, and as a result, family is much more important than it was a few decades ago. By family he means community – friends, neighbors etc. He encourages robust use of technology to mitigate the greatest challenge to family – the lack of time spent together.

I was reminded of this point this morning when I got an e-mail from a friend discussing the weekly results in our Fantasy Football league. Included with the e-mail was this picture taken out the window of his hotel room, in Istanbul.

Yes, his hotel in Istanbul has WiFi. Quoting from his e-mail where he quotes the natives “ees magic, yes?“

Not magic, just Byzantine technology.

On last night’s Apprentice, the contestants were tasked with creating an in-store catalog for Levis. As usual, my mind was cranking through how I would solve this business problem. What does Levis mean to me? What emotionally attractive image would I create to sell more jeans? How would I present this to customers in a catalog?

I was watching the show off my ReplayTV, skipping the commercials. But midway through I realize, this is an hour long commercial for Levis. And I like it.

Now my mind shifts from the narrative, to the real story – this is a moment of business genius. How often can a marketer engage even a single customer so deeply?

So how does he do it? By presenting a problem that’s fun to try and solve. If that is too challenging, you can just evaluate the merits of the two team’s solutions. Either way you consider how you feel about the problem and its potential solutions. If the problem is related to a product, bingo, the viewer becomes involved with the product in a way much deeper than a 30 second spot. Throw in aspirational characters and attractive images and you have a marketing program bordering on mind control.

This is way beyond a simple, money for airtime, product placement deal. Burnett got a big check and a story from Levis. Levis got millions of viewers to sit still for an hour and get emotionally and intellectually involved with their product. Everyone wins except maybe Jen, who sold lots of jeans last night, and probably did not get paid. Butt I’m sure she will be a money-maker on the backside. Sorry.

It’s like Google, the product and the business model work together to create greater value. So does the Apprentice point to a business model for more modest media, like blogging or Podcasting?

At the risk of becoming the “I heart Adam Curry” blog, I will point out that Dailey Source Code spends a huge amount of time asking and answering questions about technologies related to PodCasting – microphones, headphones, editing software, Radio Shack, blah, blah, blah. He throws out problems that are fun for his audience to try and solve, and in return, gets material for his show. Now he needs to close the loop with the sponsors. Thanks to his web site, this could be QED.

So I will throw out a problem. If you were me, how would you monitize this site beyond AdSense?

And don’t worry, unlike Jen, I won’t take all the credit for the idea.

I used to Series 7 registered, but that lapsed many years ago. So this is not investment advice, but a story about open source plus VOIP and the massive disruption that will ensue. Or maybe it’s just a story about a start-up too cheap to pay $75 per line for telephone and voicemail service.

When I read about VOIP, I think, yeah, yeah, Vonage. That will be rough on the Baby Bells but you still need a DSL line. And home users will probably keep their PSTN line as it’s price competitive. Big businesses optimize their telecommunication costs anyway. So it will be bad for SBC, but they will still have small/medium business and most of the home. Well, read on…

Like any start-up we needed a DSL line. To get DSL the valley, SBC makes you buy a voice line for an extra $15 a month. Unless, of course, you want to use the voice line, then every call costs extra. If you want an unlimited voice line with voicemail, it is $75 a month, per line.

So you look at Vonage at their peers, but the business plans are $40 - $50 a month, per line. And if you want true business features like automated attendant and forward-able voicemail, it’s lots more (but less than SBC would charge). So we soldiered on for 4 months with my 10 year old GE answering machine attached to the voice line, using our cell phones for all outgoing calls, least we incur usurious SBC per minute charges. But as we near our corporate launch, this must change.

And then we found Asterisk. By “we,” of course I mean my co-founder who does the real work. Asterisk is an open source Linux-based PBX, that is feature equivalent to six figure PBX systems. Like RedHat they sell compiled bundles for a few hundred dollars. But, again, we are a start-up, so my co-founder made Debian recognize the card (Asterisk requires a $100 card for PSTN phone or use of a $60 internet phone) he installed in our beige box PC. Then he configured Asterisk to talk to a couple VOIP termination providers, which is as easy as providing your static IP address. The ones that charge even take PayPal. The most time consuming aspect of setup was going through the configuration screens as there are so, so many features.

Now we have every conceivable telephony feature (ok, no RSS enclosure feed for voicemail, but it’s open source - we could add it). Look at a small/medium business telephony features list – we have that and much more.

And the cost? Free. In coming calls? Free. Outgoing calls? $0.013 per minute to the US. Unless we are contacting another Asterisk installation, then? Free (talk about network effects!). So our global telecommunication costs – about $10 a month for VIOP, $15 to SBC for a voice line we don’t use, $50 for DSL to an ISP (who pays something to SBC for using their lines). Instead of $75 per line, SBC gets about $40 total.

So Open Source disrupts the equipment providers, and VOIP plus Open Source disrupts the service providers.

Now, recent struggles aside, Intel has a habit of making markets. So what if WiMAX works as billed?

SBC gets nothing.

Every wonder what happens when two A-list bloggers reference your blog?

More surprising is that Doc called me a “writer.”

Last year this was a great event. They discussed 12 trends. By my count, they went 5 for 12, but had some direct hits that were not obvious last year. This year was less interesting, and very poorly produced.

But anyway, here are the trends with my thoughts as well. Keep in mind these are supposed to come true in the next 2-3 years.

1. Doerr – NextWeb. See my post on Web 2.0 conference below. General agreement among the panelists. Doerr singled our Blogging and RSS twice.
Of course I agree, I am betting my career here.

2. Dyson - Personal Electronic Health Records emerge and create opportunities for data sharing, protection and search. Panel was skeptical.
This happening in 2-3 years is laughable. When the boomers retire and taxpayers are hit with the triple whammy (shrinking number of taxpayers, increased number of retires, and escalating healthcare costs) maybe there will be enough force to break through the inertia. We are still 15-30 years away from this happening.

3. McNamee – There will be no major waves of enterprise technology spending equivalent to Windows, Y2K or ERP for 5 years. He elaborated to say that the next big trend will be Web Services, but today we do not even understand the processes we need to automate. Thus we are in a DIY period for IT. Investors in public software companies will suffer. Panel disagreed. Doerr – web services are happing today. Schoendorf – this is a bullish sign, next 2-3 years will be a golden age.
Disagreeing with McNamee is perilous, but I will. We are through the dry spell. Companies are looking to IT to drive competitive advantage and IT is looking to vendors, particularly start-ups. In our corner of the world, we see revenue being generated and processes being automated with RSS everyday.

4. Schoendorf – China is the next global innovator. China is the first big threat to the quality of life of Silicon Valley. The panel disagreed mostly due to timing reasons.
I agree strongly. I particularly like the second sentence. Currently the Valley leads the world in entrepreneurship. As a result, many people of modest talent and work ethic enjoy a fabulous quality of life. As China asserts its scale and people advantages, this will change. To stay on top, leading companies must work with Chinese nationals, not just to leverage low cost labor, but to do R&D, and to open a new market. Else our children will inherit a world with the majority of the global 2000 companies being Chinese companies.

5. Perkins – Mainstream media and entertainment will relent to the “Open Source Media Revolution” leading to a mini-boom for content creators, blogging and social networking tools and application developers. He elaborates to say that any media company that does not open up to sharing, collaboration, and transparency will not have consumers trust and will parish. Panel felt this happened last year.
I agree, but the boom will be in attention paid, not in revenue or profits.

6. Doerr – Stem Cells will be a medical revolution and California will lead it. Panel agreed, but felt it will take more than 2-3 years.
I don’t follow this market, but I hope he is right.

7. Dyson – Cell Phone text messaging will boom in America and be used for many new applications including personalized marketing and drug compliance. Panel agreed.
I think SMS text messaging is still too hard. When Treo 600 type functionality is bundled with service, mobile applications will explode.

8. McNamee – Consumer Technology and Content that targets people over 30 will be more successful than products that target younger people. He sites demographic trends, average iTunes users being over 30, Finding Nemo being the number one selling DVD and the fact that those under 30 do not buy but share/steal. Panel disagreed. Doerr did a scholarly job of refuting and Schoendorf noted that globally this is ridiculous.
I disagree that it will be more successful, but it is worth noting that there are lots of tech savvy folks over 30 for the first time in human history.

9. Schoendorf – Digital Living – Throw out your TV, DVDs, CDs and Stereo because it is all obsolete. From here is will all be stored in one place and transmitted wirelessly. Panel was mixed. Doerr thinks no one would trust this job to Windows. Dyson felt sharing will drive this trend.
I agree, but sadly, my wife doesn’t.

10. Perkins – A cultural move to IT as a utility in computing will keep the IT business growing. Panel agreed.
Obviously the panel has never sold a service to IT. This is a complex and long term trend that has more to do with the IT department’s employee incentive system, than to do with technology.

Last year they had audience participation at the end. I wrote down “RSS revolutionizes communication,” They did not read it. But it’s still my top pick. As Dave Winer says, if you don’t have some apprehension about pushing the publish button, you are not doing a good job of blogging. Time will tell who is right.