LOOKING back on 2006, which technologies relevant to investor relations failed to live up to the hype that surrounded them?
Fortunately, the list is short because IR websites were not the scene of much innovation during 2006. Relatively few new technologies even registered a blip among the 525 sites in our survey.
Some of the new technologies and practices that did appear are valuable additions and are likely around for a long time. But at least two new technologies failed to live up to expectations.
Now, please note that this article is not made for skimming. You really have to read what I say to get the nuances. With that out of the way, herewith the two most hyped technologies for investor relations websites in 2006:
Most-hyped technology #1: Podcasting
If ever there was an over-hyped technology, podcasting or the delivery of MP3 audio files via RSS, takes the cake. This is such a pedestrian, low-rent technology that even the early adopters like IBM and GE basically gave up on it during the year.
IBM, which kicked off a custom podcasting series with much fanfare in 2005, stopped producing its series in April 2006. GE, which used to offer its earnings calls as podcasts, stopped doing so in the third quarter.
The problem here is two-fold. First, unless it is live, such as a real-time webcast, audio is a really bad format for delivering essential information to investors. Text is by far the most effective format for this type of content.
Second problem is that investor relations information is dull at the best of times and audio does nothing to make it more attractive. People are not going to be downloading your conference calls to their iPods for easy listening on the subway, no matter what some consultants’ surveys might tell you.
So it’s not surprising that predictions of widespread podcasting adoption by investors failed to live up to expectation. Much of it was PR-fueled hype by vendors to push more product.
Now, there is an important caveat here. You need to draw a distinction between podcasting hype — such as producing custom content for podcasts — and simply providing MP3 files of routine investor relations audio content.
The MP3 format, which has been around for years, is useful in certain circumstances and also is cheaper than archiving streamed webcasts. It makes good sense to provide MP3 files as an additional format option for recent presentations and as the only format for older presentations and earnings calls.
And yes, you can enclose MP3s in your main IR feed. No harm in that, but it’s not something to make a big fuss about or spend any money on. There are much more effective things you can do with your time, money and energy. Podcasting is pedestrian.
Most-hyped technology #2: Rich Internet Applications and Ajax.
RIAs are all the rage now among web developers who like to think they’re leading edge but who in fact are probably more bleeding-edge. RIA techniques can be useful and can dramatically improve the user experience of websites, but it’s not a foregone conclusion that they will.
In most of the applications we’ve seen on IR websites, RIAs make usability worse, not better. This is largely because the developers implementing them are doing so more for the “wow factor” and their own egos than for any solid reasons based on user needs.
Now, to be clear, I am not against you using RIAs on your IR website, I am just opposed to most of the applications that I’ve seen so far.
If you are going to use RIAs, then you must make sure to test any application in a usability laboratory. That’s going to add substantially to your costs of website development, which will force you to think twice before agreeing to let your web developers have fun at your expense.
More hype ahead
As we close out 2006, those two technologies – podcasting and RIAs – stand out for failing live up to the hype that surrounded them. There will be more hype in the year ahead.
The best advice I can give you when assessing any new technology is to put yourself in the shoes of your IR website’s users and ask if new technologies are going to provide value to them.
Any time you put your own interests — or the interests of your web developers — ahead of your investors’ needs, you are bound to fail.
What others say
Of course, this is the time of year for “Year in Review” articles. Here are three that caught my attention:
- Six things that suck about the Web in 2006 by Roger Johansson, a prominent Swedish web designer and author of the 456 Berea Street blog.
- 2007 Web Predictions by various authors at Read/WriteWeb, a multi-writer blog about Web technologies.
- 2007 Predictions for the web and software by Don Dodge, a Microsoft executive blogger with a focus on new ventures.
Hmm…none of the above articles mentions podcasting. RIAs feature prominently, though Roger Johansson also isn’t impressed so far. I wonder how many of the predictions will turn out to be next year’s most-hyped technologies.