free html hit counter April 2007 | Page 3 of 10 | John Battelle's Search Blog

Paul, I Agree

By - April 24, 2007

I know I give Google it’s (fair) ration of crap from day to day, regardless of those of you who feel I’m a Google apologist. Well, you can’t win both sides of that argument, all you can do is be honest to what comes to mind. Right?

And when I read this from Paul, I have to say, I quite agree.

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What Do You Want to Talk About?

By - April 23, 2007

Our first ever interactive Web chat is happening this week, and in advance I’d like to ask what you guys want to talk about. The format is mostly questions and answers, and even has the ability to ask the audience surveys. A bunch of you have signed up already, but I’d love to hear from more of you. So in comments, tell me what you’d like to talk about. Ideas:

– What’s the future interface for search?

- Can Yahoo pull even or ahead of Google?

- Will Microsoft buy its way in?

- The Doubleclick deal – good or bad or indifferent?

- Privacy and data use – discuss!

What do you think? Join the conversation by registering here. Thanks!

Updated: Goodness.

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Sometimes, sounding arrogant isn’t intentional. It’s just in the bloodstream, or it’s casually tossed off without thinking how it might sound. Read this excerpt from a very interesting Merc story on Google’s internal communications regarding stock options:

Google is proud of the innovative products it regularly releases to the public, from the ever-more-targeted Internet search results to an automatic Web-based airport-ride finder.

But the coolest stuff is often reserved for Google employees. And they’re about to get access to a killer tool, otherwise known as the “supersecret Google is about to buy Yahoo” alert.

Technically, this is an e-mail that informs all 12,230-plus Googlers that the in-house market for transferable stock options has been shut down.

In reality, it means something really, really big is about to happen to the company that could affect the stock price.

“For example, if Google decides it wants to buy Yahoo, that’s a really big deal,” said David Sobota, Google’s senior corporate counsel. “We wouldn’t want to disclose that to the world the first time Eric Schmidt comes to a handshake agreement with Terry Semel about it, because that could disrupt the negotiation process.

Read that last quote again. “”For example, if Google decides it wants to buy Yahoo,”….

I can’t imagine how that sounds in the halls over at Yahoo. Youch.

Update: A source at Google set me straight on the context here: the line was delivered in an internal meeting at Google, the transcript of which had to be filed with the SEC. I thought it was a quote from the counsel to the reporter at the Merc, which would have sounded arrogant. In an internal meeting, it came across as a funny joke, a silly example to help employees understand the program described. Still, it wasn’t “if Yahoo buys us,” now, was it?!

More from Google’s Steve Langdon in Communications:

Hey John. I thought I’d share a bit of context about your recent post. The TSO program (http://googleblog.blogspot.com/2006/12/about-transferable-stock-options.html) we launched is complicated. To help employees understand how it works and how it affects them, we held internal meetings to answer questions. One of the things we wanted to explain in those sessions is why the program might occasionally shut down. To help explain what kinds of things would suspend the program, the attorney offered an imaginary illustration that would be easily understood — it was intended to be humorous and the audience clearly understood that it was made tongue in cheek. (If the transcript was able to record the laughter in the room prompted by this illustration, this would be clear to anyone.) The audience was internal. These are not public meetings. Because of SEC regulations, however, we are required to file transcripts of these sessions and that’s where this comes from. I think you’ve read far too much into this imaginary illustration that was offered as a way to help explain a complex program.

Google And Yahoo: Cnet Analysis

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Story is here. The author even quotes the publisher of Searchblog. Thanks, Elinor!

Next Up for Big G: Web Conferencing

By - April 21, 2007

Marratech-1

Matt has the news on the acquisition of Marratech‘s software, from the Google Blog:

As a company, we thrive on casual interactions and spontaneous collaboration. So we’re excited about acquiring Marratech’s video conferencing software, which will enable from-the-desktop participation for Googlers in videoconference meetings wherever there’s an Internet connection.

We look forward to learning from the extraordinary ingenuity of Marratech’s engineers as they focus on desktop conferencing research and development in Sweden, where they will continue to be located.

Update: To clarify some confusion, we acquired Marratech’s software, not the company itself.

I want to believe the implication here, that all Google wants is an internal video conferencing solution. But I can’t imagine they’d keep this all to themselves….

American Blinds Case Ain't Going Away

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10Offabwmwoods

I covered this in my book and on this site, and it’s an ongoing issue for Google and the whole keyword industry. From CNN:

A judge on Wednesday refused to dismiss a lawsuit against Google charging that the Web search leader’s AdWords program abuses trademarks.

In making his decision that effectively allows the case to move forward, U.S. District Court Judge Jeremy Vogel ruled that the public has an interest in whether Google (Charts, Fortune 500) AdWords violates U.S. trademark law.

American Blind & Wallpaper Factory, the top U.S. reseller of window blinds, charged in its lawsuit that Google abuses trademarks by allowing rivals of a company to buy ads that appear when consumers search the Web for information on that business.

Lots to Talk About: Sponsored Chat For Searchblog

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Webex

What a great time for Searchblog’s first ever live chat. Next week, April 25th at 1 PM PDT, to be exact, Searchblog sponsor WebEx is offering us its platform for a live chat about all the stuff that is going on in search and media. Mark your calendars, I’m looking forward to this new way of continuing the conversation!

We’ll be talking about all the hot button issues we discuss here at Searchblog – business models, future search interfaces, privacy, you name it.

All you have to do is register here to attend….hope to talk to you then!

WHOPPER ACQUISITION CORP

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Whopper

I love it. Companies often create cute names for corporations they create to facilitate transactions. The one Google came up with for DoubleClick?

“WHOPPER ACQUISITION CORP”

Reviewing the merger agreement now…

News Analysis: Microsoft General Counsel on DoubleClick and Antitrust

By - April 20, 2007

Microsoft

I had an interesting call today with Brad Smith, the general counsel of Microsoft. I was eager to understand Microsoft’s position on the Google/Doubleclick deal, and to parse the issues swirling around the companies decision to, via the press, declare that the deal should be scrutinized closely by antitrust regulators here in the US.

The conversation started with Smith explaining why Microsoft sees this as worthy of a serious review. At its heart, he contended, this is about how one might define the market in which the combined company will operate. Antitrust law, he explained, takes a dim view of companies who buy their way to market domination using cash alone. It’s fine to gain market domination by having better products and service, but not by simply buying your way in. So, does buying Doubleclick mean market domination? That question turns on whether a market is narrowly defined – is the market in this case online display advertising and online contextual advertising, or is it more broadly defined – the entire advertising marketplace?

This is not a minor question. The former is a market in the tens of billions, the latter hovers at a trillion dollars. When I asked Eric Schmidt of Google this question onstage earlier this week, he was very clear in his interpretation. After rolling his eyes at the very idea of Microsoft – star of the antitrust stage in the late 90s – even playing the antitrust card, he very clearly stated that the combo of Google and Doubleclick was a tiny percent of the overall advertising world.

Smith, as one might imagine, doesn’t ascribe to that interpretation. The market should be narrowly defined, he stated. He then went into how antitrust regulators actually view markets. “There is a defined methodology,” Smith told me, for how antitrust review is done. “You look at who is participating in the market and ask if they will shift behaviors if prices change by five percent.” Also, will one company have the ability to control pricing and, also importantly, will it be difficult or impossible for any other company to enter that market? Smith believes that GoogleClick will have such market dominance in online advertising as to be able to force higher prices upon the world – online advertisers will not easily move their budgets to offline media like TV or print, they are too dependent on online channels. Hence, one should not view the market broadly.

This raises a very important question – why didn’t Microsoft match Google’s $3.1 billion offer. Smith would not comment on this, but I can report from very good sources that in fact the company did offer to match it, and was willing to pay even more to insure that Google did not corner the online ad market. But for whatever reasons, the private equity firm that owned the majority of DoubleClick’s shares decided to go with Google. I have more detail on how that deal went back and forth – it involves a no shop deal between Google and Doubleclick, for example, but I have heard strong assertions that the owners of DoubleClick did not get the highest and best price for their asset. But that is now history. In short, it’s clear Microsoft has the cash to match or even beat Google at this game, but did not in the end win the asset. Why? That’s for another post.

“The bigger question,” Smith asserted, “is what is the market share and will it be easy for others to enter this market once this deal is done?” He continues: “There’s a fixed cost to developing the technology, but that’s not the hard part.”

Indeed it is not. The hard part is getting the economies of scale and knowledge that come with having a massively scaled base of advertisers and publishers all using the system. That allows for maximum efficiencies in the market and maximum profits. Google already has this in the contextual advertising space. With DoubleClick, it will have it in the display ad space as well, Smith points out. That means it’s very hard for anyone else to enter the market.

That may well be. It’s hard to say what the government will do with this case, but under the HSR antitrust act, it has 30 days to decide. It will take one of three approaches, Smith told me. One, it will, after a 30 day review period, simply decline to investigate further and allow the transaction to continue. Two, it might decide early that this is not a material issue, and approve it before the 30 day period. Or three, it will make a “second request” for more data, which can take months for the companies to respond to. Once that response has come in, the government will make its final ruling – block or allow – in another 30 days.

Clearly, Microsoft wants to see a second request. I asked Smith about the irony of Microsoft asking the government to support it on antitrust. His response was interesting. He pointed out that Eric was never shy about asking for the government’s help against Microsoft when he was at Sun, Novell, or even Google (remember the browser issues?) . “I think regulators take competitors (in this case, Microsoft’s) views with a grain of salt, and they should,” Smith said. “I would point out that over the years our competitors have been raising a number of antitrust issues that they want regulators to review, and I don’t think it’s ironic that we ask for the same thing.”

Msftyahoo-Tm

In the end, the matter is in the government’s hands. If the deal does go through, it will create an entirely new landscape for Google’s competitors, one that will require, in my mind, that Yahoo, Microsoft, and other large players consider moves that previously were unsavory. To my mind, the most obvious of these moves is a strong partnership or even merger between Yahoo and Microsoft (remember Soverture?). To that end, what Yahoo’s Jeff Weiner had to say on stage, at the end of our discussion at Web 2 this week, is both timely and very pertinent. I asked him about Yahoo’s view of Microsoft, given the state of the chess match as it currently stands. His response was direct: Yahoo would be very open (scroll to bottom) to discussions with Redmond. After all, it wasn’t that long ago that Microsoft was running Yahoo search (via Inktomi), and monetizing using Overture.

Wow, I love this business. It’s such a great story. Happy Friday…..

Updated: I have not had time to review this, but Gary has the merger docs filed with the SEC. And I have a few more thoughts on this topic. The more I think about it, the more the fact that DBCLK went to Google strikes me as a seminal moment in the history of this industry. Microsoft could not win it, despite the cash it was willing to spend. Why?!