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Howell D.

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Proximity Research Report

=Grid Computing : The Alternative To Advertising =

By Dennis Howell

Spring 2010

Table of Contents

Executive Summary **(1)** Introduction: Gen Y Hates Advertisements **(2**) Research As An Alternative Business Model **(2)** An Overview of Digsby **(3)** Plura Processing **(4)** Recommendations **(5)** Attachment 1: Focus Group Results **(6)** Attachment 2: Plura's Services **(7)** References **(8)**

Executive Summary **

Our research indicates that Gen Y users are displeased with intrusive advertisements on social networking sites. Our research also indicates than Gen Y wants a more simple and convenient social networking environment. Gen Y users might want to use third party software that takes them to social networking sites indirectly. These third party software make it difficult for advertisers to reach Gen Y.

Digsby is an example of a third party software that Gen Y might be interested in. It uses an experimental business model that relies on grid computing. Digsby makes money by providing computing power for research projects. It is recommended that companies who want to reach Gen Y wait until more data comparing the grid computing model with the traditional advertising model becomes available before making any changes. Web developers should try the experimental grid computing model to attract more Gen Y users.

Our research indicates that Gen Y users do not pay attention to advertisements on social networking sites. Gen Y users realize that social networking is free because of the advertisements. They would rather accept advertisements than pay to use social networking sites. Gen Y might be willing to friend their favorite businesses on Facebook but they will not friend unfamiliar businesses. In general, Gen Y users accept advertisements on social networking sites but they complain about the intrusive nature of online advertising.
 * Introduction: Gen Y Hates Advertisements **

Our focus group results show that Gen Y users prefer their social networking environment to be simple (see attachment 1). Gen Y users feel that online advertising adds clutter to social networking sites. Because of this, some Gen Y users actively avoid advertisements by using ad blocking software such as "Ad Block Plus." "Ad Block Plus" is designed to give the user the ability to decide which advertisements would appear on websites. Many users set the setting to block all advertisements (Palant 2009).

Excessive advertising on social networking sites may be counterproductive because it could hurt a company's reputation rather than promote its brand (Gruber 2006). Advertisers risk damage to their reputations if they are not careful in how they advertise on social networks. For example, //Johnson & Johnson// could damage it's reputation if it places an ad for baby products on a social networking site that displayed racy images. Gen Y's attitude towards online advertising and the unpredictable content of social networking sites make advertising on social networking sites a risky method of reaching Gen Y.

Social networking sites contain a vast amount of information on Gen Y. Word of mouth advertising is one of the most effective methods of marketing a product. Gen Y users often recommend their favorite products to their friends (Skul 2008). Companies can use social networking sites to obtain information on which demographic talk about their products. For example, Sony could run a search in Facebook for Playstation 3 and obtain results it can use to see which demographics talk about Playstation 3. Sony could then use the results to adjust their marketing campaign to suit the interest of these demographics. Companies could use this research method to make their advertising campaign more effective by reducing the cost and focusing the campaign on those who are interested.
 * Research As An Alternative Business Model **

Our research shows that Gen Y users want their social networking environment to be simple and convenient. This may lead Gen Y to third party social networking software which connect Gen Y users to their favorite social networking sites indirectly. Advertisements on social networking sites will be less effective if Gen Y users connect use third party software. The providers of third party software are looking for a way to make money while offering their product to Gen Y for free. Third party social networking software providers are considering three option; Gen Y users will not pay for premium services nor will they they find it advantageous to use third party software when ads are incorporated. The research module is the most attractive option of the three since it does not complicate the social networking environment.
 * incorporating ads;
 * charging a small fee for premium service;
 * incorporating a research module during install (Digsby 2009).

Companies can pay the research companies to conduct internet analysis. The research results can be used as a snapshot of the local demand of a certain product. A company can use this for planning how much of a certain product to sell in a given region. This will allow business to build a more effective advertising campaign and/or to reduce business operating cost. ** An Overview of Digsby ** Digsby is a free third party instant messaging software that integrates multiple instant messenger accounts, email account and social networking accounts. Digsby allows the user to view their profile, photos, and friends with a click of a button (Drperdew 2010). It also allows the user to view and respond to newsfeed within the software. Users can update all of their statuses simultaneously using Digsby's global status feature. Digsby offers Gen Y an all in one social networking station that is simple and convenient.

Digsby makes its money using an experimental business model that provides computing resources for research projects. This involves embedding an optional research module during installation that uses a technique called grid computing. Grid Computing combines resources from multiple computers and applies them to a single task (see figure 1). These task usually involve intense computations and/or the use of large sets of data. Grid computing usually involves the use of middleware which divides and assigns portions of a program to multiple computers (Grid computing 2010). Figure 1 Visual of Grid Computing

Digsby's grid computing module activates when the user's computer is idle (no mouse or keyboard movement) for more than five minutes. The module will shutoff once the user moves the mouse or presses a key. The grid computing module does not interfere with the functionality of the user's computer since it only operates when the computer is idle(Digsby 2010). Digsby does not do the research itself. Digsby provides Plura access to the computers processing power to distribute for research purposes. Plura is a company that serves as a middleman for grid computing research. Plura provides the necessary software packages that make use of idle computers. This computational power is then sold to consumers to be used for research. This offers developers an alternative to the conventional advertiser dependent business model.
 * Plura Processing **

Naturally Gen Y users might have concerns with letting a third party use part of their computer. Plura takes these concerns into consideration by using the "sandbox model" provided by Sun (Plura 2008). This security feature separates the processes running on borrowed memory from the rest of the computer's files. This prevents the third party processes from accessing the user's files and programs (Sandbox 2010).

Companies can purchase borrowed computing power from Plura to conduct research. This is most useful in the research and development stages of production. Companies can use computing power from Plura to conduct market research on Gen Y trends or run simulations on new products. Plura offers companies a more cost efficient alternative to renting super computers (see Attachment 2).

The grid computing business model has not yet proven itself. It is too soon to gauge how successful it may be. There is not enough information on the revenues generated from grid computing to determine if it is a better option than traditional advertising. I recommend that companies who are trying to target Gen Y wait until more information about the grid computing business model's performance becomes available before changing from the traditional advertising methods.
 * Recommendations **

The grid computing business model does offer web developers an alternative to relying on advertisers for revenue. Our research shows that Gen Y is displeased with intrusive advertisements on their social networking sites. I would recommend that web developers try the new grid computing business model to attract more Gen Y users.

**Attachment 1: Focus Group Results** Focus group results showing what Gen Y looks for in their ideal social networking site.

Facebook is currently the dominant social networking site and therefore the most attractive place for businesses to connect with Gen-Y users. The social networking landscape, however, is volatile because users can easily switch from one site to another. Our focus groups seek to determine if Gen-Y still favors Facebook, how they primarily use the site, and what developments would cause this demographic to switch to another site. This information will allows to advise Proximity clients about how to create an effective presence on Facebook.


 * 1) What social networks do you use and why?
 * 2) How do you use social networking sites. Do you actually spend time on the site interacting with individuals beyond a circle of friends ?
 * 3) If your favorite stores and companies had pages on social networking sites, would you follow them? Why? How would you prefer to communicate with them?
 * 4) Do you feel that your social networking site protects your privacy
 * 5) Does your social networking site allow you to customize your pages as much as you would like?


 * Findings**
 * likes simplicity
 * has "follow the crowd" mentality
 * privacy not a major concern as long as there are settings
 * not worth it for businesses to try to connect
 * military and females social network more

**Attachment 2: Plura's Services** A description of Plura's services with price comparisons.

**Main** | [|Games] | [|Developers] | Blog[|Home] | [|Affiliates] | [|Customers] | [|Individuals] | [|Technology] | [|Contact Us] =Customers= Our value proposition to customers is simple: we offer one of the largest sources of compute power at highly affordable, on-demand pricing. Our customers only pay for the amount of compute power they use and don't have to invest in computing infrastructure. Due to our unique technology, our customers can save 10 to 12 times the amount they would have to spend for other compute sources. The table below illustrates the benfits of using Plura over competing technologies: A wide variety of customers can use Plura for many different computationally-intensive applications. Potential applications include: Applications that are highly parallel and require a significant amount of compute time relative to the amount of data transferred are most suitable to Plura. That said, our team has found several creative ways to parallelize many different algorithms and we can work with you to fit your application to our framework.
 * ~  ||~ Clusters ||~ Clouds ||~ Plura ||
 * Free of capital expenditure || [[image:http://www.pluraprocessing.com/_images/x.gif width="15" height="17" caption="No"]] || [[image:http://www.pluraprocessing.com/_images/check.gif width="17" height="16" caption="Yes"]] || [[image:http://www.pluraprocessing.com/_images/check.gif width="17" height="16" caption="Yes"]] ||
 * Data is secure || [[image:http://www.pluraprocessing.com/_images/check.gif width="15" height="17" caption="No"]] || [[image:http://www.pluraprocessing.com/_images/x.gif width="17" height="16" caption="Yes"]] || [[image:http://www.pluraprocessing.com/_images/check.gif width="17" height="16" caption="Yes"]] ||
 * Costs scale well || [[image:http://www.pluraprocessing.com/_images/x.gif width="17" height="16" caption="Yes"]] || [[image:http://www.pluraprocessing.com/_images/x.gif width="15" height="17" caption="No"]] || [[image:http://www.pluraprocessing.com/_images/check.gif width="17" height="16" caption="Yes"]] ||
 * On-demand availability || [[image:http://www.pluraprocessing.com/_images/x.gif width="15" height="17" caption="No"]] || ≤ 5,000 nodes || ≥ 50,000 nodes ||
 * Typical compute costs || $150k - $1.5M || $100k - $1.2M || $12k - $120k ||
 * Oil & gas exploration algorithms
 * Financial modeling
 * Bioinformatics
 * Web crawling and Internet analysis
 * Fluid dynamics
 * And many others

Digsby. (January 2010). //Digsby Research Module.// Digsby.com. Retrieved April 10, 2010 From <[] > Drperdew. (May 2010). //MyTwitterToolbox.com Presents Digsby.// youtube.com. Retrieved May 10, 2010 From <[] > Grid computing. (May 2010). //Wikipedia, The Free Encyclopedia//. Retrieved May 10, 2010, from <[] > Gruber, F. (July 2006). //Advertising on Social Networks.// imediaconnection.com. Retrieved May 10, 2010 From <[] > Palant, W. (May 2009). //An Approach to Fair Ad Blocking.// Adblockplus.org. Retrieved May 10, 2010 From <[]> Plura. (2008). //How It Works.// Pluraprocessing.com. Retrieved May 15, 2010 From <[] > Sandbox (computer security). (May 2010). In //Wikipedia, The Free Encyclopedia//. May 15, 2010 from <[|http://en.wikipedia.org/w/index.php?title=Sandbox_(computer_security)&oldid=361458031] > Skul, D. (2008). //Use Social Networking for Market Research.// Realitivitycorp.com. Retrieved May 10, 2010 From <[] >
 * References ** Digsby. (August 2009). //Build 62 - Crystal Clear!//. Digsby.com. Retrieved April 10, 2010 From <[] >