It has been hard to write of late. There is so much going on right now in terms of new social media experiences. My wife said it was so “cute” that I was just getting into Facebook now, after it had been open for 18 months already. I snapped back that it was really just opening up now. My spontaneous application promiscuity on its platform is embarrassing. I feel like a teenager with raging widget hormones.

It is a lot of work to express yourself uniquely online. You need to manage all of your various profiles across so many networks. Each network and engine represents a different source of traffic to your personal stream- Google, LinkedIn, WordPress, MySpace, Facebook, etc. Furthermore, they each provide different degrees of control over how your electronic likeness is distributed to others. In Media Futures speak, these are your various API’s (some which you control fully like your blog, others not at all like your PageRank) that together form your unique Algorithm identity in the online world.

This all makes sense, from the 30,000 feet perspective that I typically have written from in the intellectual capital that is New York City. But now that I meet with folks at Grove in the Marina instead of La Fortuna on West 71st street, I am both more engaged in the “real” world of Internet startups but also that much more conflicted by it.

While there are certain voices out here that call for radical transparency so as to keep any unsavory data mongers at bay, those same voices forever remain two cycles ahead of what gets funded and remain marginalized to watch as others commercialize their ideas from two cycles hence. The Internet is a data platform and therefore Internet businesses need to generate cash flow off of people’s data. This is the reality of the multi-billion dollar cookie cocoon that we are all clicking away within.

Still, regardless of how hopeful or hopeless the open Attention ecosystem proves to be, there are early traces of “mass market” Internet services paying Attention to Attention. For example, YouTube now enables me to “broadcast” what I am watching as a form of entertainment for others:

And LinkedIn now enables me to see who else has visited my profile

Granted these are small steps, but they are small steps by large players. Not to mention some truly open Attention thinking practiced by Google in both their Reader and Web History products that I will discuss in a coming post.

Despite all the hyperbole about the Internet advertising market M&A activities, I am surprised at the lack of critical perspective about the consolidation of cookies being placed and managed on users’ computers without their knowledge.

The recent spamacornucopia means more than $10 BILLION DOLLARS OF YOUR DATA IS BEING EXCHANGED AMONG BUYERS AND SELLERS THAT YOU DON’T CONTROL, starting with DoubleClick (and H&F their private equity owner) and Google, and then Right Media (Redpoint) and Yahoo!, and then 24/7 and WPP, and now aQuantive and Microsoft.

I have heard that a profile is worth a dollar.

One could assume that a clickstream is worth $10.

We know, after all, that a mortgage lead can be worth more than $100.

How much is a cookie worth? As in, how much does it cost a company now on average to place a cookie on a user’s desktop? Of course the folks at Tacoda, Blue Lithium and Revenue Science would know this with more granularity, but my sense is that a cookie is currently worth about $.10. Please comment below if you have additional perspective.

And so, the $10 billion dollars worth of online advertising deals would equate to about 100 billion cookies served.

Do we as users have any sense of this reality, or any control over its consequences?

I am slowly starting to settle into a routine here in California.  The past few months have been filled with new beginnings- a new school for the kids, a new job and commute for Tina, new grocery stores and restaurants and little league fields.  The Taxi cab-hailing hustle of Manhattan has given way to hustling my bike to the top of Mt Tam.

Ideas don’t change at the same pace as activities, however, and I find myself thinking through the same issues about transparency that stimulated this blog in the first place.  Back then I was focused on soft dollars and the opacity of financial markets not media markets:

…soft dollars and bundled commissions are the vig that generates much of the wealth among the brokerage industry in New York, which in turn lubricates expense accounts at lunch time and grand Park Avenue co-ops and East Hampton beachfronts. Is it not ironic that New York has a mayor whose namesake company benefits more from monthly soft dollar payments than perhaps any other financial institution. In a way, Bloomberg has taken the notion of value-added brokerage services to the peak of civic duty. Our city itself reflects the residual value of opacity in financial markets. And so the question comes back to what happens to the brokerage industry when transparency become of more value to investors than opacity?

Three years later, soft dollar pratices are as opaque as ever.  The SEC has catered to the rich interests of hedge fund and stock brokerage lobbyists and enabled both sides to continue their practice of doing business with eachother in a very gray market.  Even the most sophisticated individuals outside of the financial services industry have little sense of what is really going on, in terms of the ways in which large institutional investors and large banks and brokers profit from closed data practices.

This is not that different from the dynamics of the online advertising environment- there are large institutional advertisers doing business with large media companies and advertising networks.  Despite the pre-text of openness and transparency, the online media market works hard to obscure the discovery of price by the very individuals producing it; namely the people who are using the medium, searching for things, clicking on ads, and conducting commercial transactions.  The web user, like the individual  investor, has resigned himself to letting larger interests capture, aggregate, and monetize his data behavior.  He has been led to believe that this is simply part of the bargain of having such "low" transaction costs for trading stocks or searching for information.

If I had to draw a continuous line through all of my disparate activities over the past ten years, this would be it:  identifying and interpreting the direct economic value of an individual data actor.  We may never in our lifetime see a day when a person develops an acute, vested interest in the value of his data; the spread between the value of a handful of clicks and that of a mass of aggregate behavior is significant.

Although it may be hard to keep track of the progression of Media Futures, we are stuck between the end of Alchemy and the beginning of Arbitrage.  This is where the creativity stops and the money kicks in; not that surprising against the backdrop of so much M&A activity (DoubleClick, RightMedia, StumbleUpon, etc.)

In May 2005, I made this transition in the first Media Futures series.  It was etymological in nature and only hinted at the real activities that I was engaged with as an entrepreneur, as I handed over the reins of Majestic Research to a new CEO in order to focus on creating Root Markets.  Flash forward two years and I am at a similar juncture; this time moving from Root in NY to AttentionSoft in SF.

The transition from Alchemy to Arbitrage that I want to describe this time will be more personal, now that the philosophical ground work has been established.  I want to trace the evolution of a central idea- transparency- through the founding of a new investment research process in 2002 all the way through the creation of a new consumer data platform in 2007.

As always, thanks for staying tuned.