John Battelle's Searchblog

Saw this greeting me whilst on Twitter.com today (gotta love WiFi on a plane):

Nice to see Twitter rolling out so many new things, like Lists, which seems to be taking off (though I find the lack of a discovery interface vexing, for now).

Retweeting is integrated in an elegant way, tweets that have been retweeted have a little cycled arrow icon, which identifies tweets that folks you've followed have retweeted. Another signal (as are Lists) that Twitter will be able to use as core data to drive its unique value. Watch that space, it's where Twitter will win (or lose).

Twitter also added the ability to retweet any tweet from within Twitter.com, as you can see in the bottom left of the pic below. No doubt this is all already in the API, as Lists was when it rolled out.

Now, why does all this matter? Well, it helps Twitter, as I already said, by providing the company with very valuable core data about what people find worthy of attention. And signals of attention are gold in a data driven platform like Twitter. Secondly, it addresses the continuing problem of discovery - seeing what has been retweeted helps people find others who might be worth following.

There's much to say about Twitter's slow to roll out but much discussed Lists feature. I'm a fan of it, in short, for many reasons. Lists is a pretty simple idea - it lets anyone make and share a list of folks on Twitter. But it's also a powerful new signal that will help Twitter solve two of its most vexing problems - first, that of discovery, and second, that of authority. Not to mention it gives everyone a chance to add value above the level of a single "follower", more on that later.

In short, if done right, Lists will provide the Twitter ecosystem a third dimension that might just propel it beyond the hype curve and into a long term platform play. Combined (intelligently) with the new traffic coming from Google and Bing, and this could mean Very Big Things for  Twitter.

All this bears further discussion. And I promise to to that, soon. I just wanted to leave a note here that I think this is important, and hopefully, when I stop traveling and start thinking a bit more, I'll dig in here.

Every month I look at Twitter's traffic, and for September, the trend continues to be flat to down. Has Twitter peaked, or is it time for the company to start showing us traffic through its API and via SMS, so we can really understand the service's growth?

Here are Quantcast and Compete's data.

The embedded chart is from Compete.

While it's fair to argue they only capture traffic to Twitter.com, it's still instructive to see that traffic to that particular domain has flattened or fallen off.

Earnings are coming in that make for happy year over year comps, and hence, a happy time in tech land. Intel, Google, IBM all

beating expectations - welcome news for an economy that has felt pretty damn terrible lately. And now the Dow has touched 10K and stayed there - something we haven't seen for a year.  

But I still worry - do you? I worry we'll over correct, and lose the perspective we've all earned over the last year of pain. I sure hope we don't. That said, I sure am happy to see the gloom lifting. We're going into winter, but it sort of feels like Spring right now....

More here.

I'm very much looking forward to the tsunami of work slowing down - Web 2 is ten days away, and my partner is starting Monday at FM - because there's just so much stuff that I'd like the time to think through, and spending the weekend doing it is not that great for family life. High on my list of topics, however, is the current donnybrook between The Entire Media World and Google. Last week media titans met in China and the CEO of AP, in particular, made a point of excoriating Google (adding "blogs" and "Facebook" to the mix for good measure). I was reading up on this topic on the AP website, which is hosted by Google. Ah, the irony.

...as pointed out in this WSJ Digits piece:

As part of the shift, Google is thinking up and tailoring more ad campaigns in close consultation with ad agencies. In May, the Mountain View, Calif., Internet giant altered its sales structure to work more closely with ad agencies and react more quickly to trends by organizing sales staff exclusively by industry, like automotive and technology. It also created a senior position responsible for improving communication with the largest ad agencies.

....The new approach is a turnabout for Google, which for years argued that advertising should be designed and priced based on strict benchmarks such as how many times an ad was viewed, rather than its emotional appeal. Marketers spent handsomely on search ads for specific uses, such as driving sales of a particular product, but when they wanted something more unique they went elsewhere, to Yahoo Inc. or other media, such as television.

As I wrote those words - "Display Market" - I sure wish we could get our nomenclature right. Because that term means a lot of things to a lot of people.

In any case, Google today announces its Doubleclick Ad Exchange, which it promises will "simplify the process of buying and selling advertising," according to the Times coverage.

Google is leveraging it's competitive advantage: "the new system will automatically allow hundreds of thousands of advertisers and publishers who now use Google’s AdWords and AdSense systems to run their ads and ad space through the exchange."

Of course they are.

This pits Google directly against Yahoo, AOL, and Microsoft in display, as each of these companies is playing here, though at various levels.

But let's be clear about what we're talking about - which is remnant display. This is not a premium publishing play. I'll have more on that, but the distinction is very important. VERY important.

Alex Salkever has written a post on Facebok's self service CPC platform, which has been getting a lot of traction lately and is largely responsible for the company's recent boasting about being cash flow positive. From it:

I chatted with nearly two dozen people who are buying ads on Facebook. Many of them are also purchasing ads on Google (GOOG) and other online venues. The overwhelming sentiment? Facebook ads are actually more effective and do a better job of getting them in front of their target audiences.

The piece is worth reading and really contemplating. How many of you use Facebook ads? Do they work better than AdWords?

SAI points to an interesting piece by Chris Dixon, founder of Hunch, in which he argues that Twitter will inevitably be competing with its core developers (complements to Twitter) at some point. This is always true for development ecosystems, however, and I don't think, in fact, it will be as bad as Chris claims. His argument:

At some point, significant (non-VC) money will enter the Twitter ecosystem. I have no idea whether this is will be by charging consumers, charging businesses users, search advertising, sponsored tweets, licensing the twitter data feed, data from URL shorteners, or something else. But history suggests that where there is so much user engagement, dollars follow.

For the sake of argument, let’s suppose Twitter’s eventual dominant business model is putting ads by search results. Who gets the revenue when a user is searching on a 3rd party Twitter client? Even if Twitter gets a portion of revenue from ads on 3rd party apps, there will always be an incentive for them to create their own client app, or to “commodotize” the client app by, say, promoting an open source version.

But it doesn't have to be so. Witness AdSense. Google doesn't own the Internet, but it has the largest ad network out there, AdSense. Sure, it's not nearly as profitable as AdWords on Google.com (100% owned and operated, way higher margin), but it's a big, big business, and it feeds a ton of data and goodness back to the mother ship, as well as supplies serious oxygen to an ecosystem that makes Google way more important as a business overall.

Hence my argument, made many times over, that Twitter will and must create TweetSense. As I've written before, it's not just search on Twitter, it's all Tweets that are the searches, and TweetWords will key off those Tweets. TweetSense will be TweetWords distributed to third parties. Those third parties would love to have TweetSense to run on their apps, I am certain of it.

It doesn't have to be a zero sum game.

Unemployment is up and continuing to rise, the recession, while possibly, maybe, sort of technically over, does not feel over at all, and while Murdoch says "things are better" in the advertising economy, "better" means "no longer totally crap."

So why on earth would I write a headline like the one adorning this post?

Because despite all that bad news, there's a fair amount of good news in the web space. A number of healthy private companies are doing quite well, and seem poised to become serious IPO candidates. Among them:

Facebook. The company said it's now cash flow positive and has been profitable for several quarters. This is the final step toward a public bow, one that could possibly stimulate a wee bit of Googly optimism, just as Google did during the mini-boom of 2004-07.

Demand. According to all accounts, this company has been profitable for several years, is growing nicely, and has revenues well over nine figures. Its search/content/social media mashup model is unique and growing.

Linked In. With a new CEO (Jeff Weiner) who would not have joined had there not been a promise of a large exit, multiple revenue sources, and a strong community, Linked In is another late stage company in the Big IPO queue.

Three companies does not a trend make, but I am sure there are others, and there are even more companies that are one to two years out (like Twitter, for example). It doesn't take that much to get a trend going in these markets. Unlike the bubble of ten years ago (wow, has it been that long), these companies all have profits, histories, and strong operating plans. And the markets have been on a tear, there is plenty of money on the sidelines, and folks are looking for a place to take a little risk after a year of hiding in treasuries and triple A-rated muni bonds.

In short, I think the IPO market is back on the table, and I would not be surprised to see it start to take off in the next several quarters.

Who did I miss, and what companies do you think might be ready to go soon?

This is very interesting. We're interviewing Adobe CEO Shantanu Narayen at Web 2 next month, man will we have things to talk about now. Why would Adobe want to get into the web analytics business (in short, supporting ecommerce and marketing)? Well, it makes sense given nearly all ads are in Adobe Flash now. Hmmmm...what do you think? From the Merc piece:

"Adobe customers are looking to us for solutions to deliver engaging experiences and more effectively monetize their content and applications online," Adobe CEO Shantanu Narayen said in a statement announcing the deal. "This is a game changer for both Adobe and our customers. We will enable advertisers, media companies and e-tailers to realize the full value of their digital assets."

This graph is a rough estimate, does not include use of Twitter apps, mobile, etc. It's just traffic to Twitter.com. But it has proven a reliable trending mechanism for Twitter. And it shows a leveling off. Now, I am going to go out on a limb and say the growth is probably mostly in mobile and third party instances. But still...

Good to see this happening:

Introducing DataLiberation.org: Liberate Your Data!

In short, Google is taking its commitment to allow data exporting seriously. This is a very, very good thing.

I had an extraordinary day yesterday, in terms of who I got to talk with. Not only did I meet with several of FM's partners - two Fortune 500 marketers, a major platform partner, and a major blogger - I also got to watch the launch of Ad Stamp and the complete schedule for the Web 2 Summit. But a highlight of the day had to be my chance to steal 30 or so minutes with the founder of DigitalGlobe, Dr. Walter Scott.  

Now why was I talking to Dr. Scott? Well, he's presenting at the Web 2 Summit this year, and I get to work with him on how Digital Globe fits into our theme of WebSquared.

In Dr. Scott's case, this task pretty much a layup.

Now, Web 2 is known for in depth interviews with titans of business like GE CEO Jeff Immelt, Comcast CEO Brian Roberts, or former HP CEO and pending Senatorial candidate Carly Fiorina - all of them are coming this year. And it's known for having the stalwarts of the Internet industry represented as well - leaders from Google, Twitter, Yahoo, AOL, Newscorp, and Microsoft will also be there.

But Web 2 is also known, I hope, for the High Order Bit - the short, mind blowing presentation of a new idea or new data that makes you step back and just say Wow.

To me, that's what happened when I really grokked DigitalGlobe, a company with a billion dollar market cap that successfully went public in the midst of the worst recession since 1931.

What the company does is pretty simple, actually. It sends super expensive satellites into space, and takes high resolution, geographic-data tagged pictures of every square foot of the earth. It then makes these images available to anyone willing to pay* (and sometimes to those who can't but really need the data, as it did with the recent LA fires).

Those images are, of course, digital. And they comprise, to echo my writing about search, nothing less than a database of surface reality, albeit from the point of view of outer space. This reality is objective, factual, and indifferent to politics. It can inform a mind bending number of new use cases. If you think about this database from the point of view of an Internet entrepreneur, well, It could become, to wax into a bit of hyperbole, fuel for a whole new ecosystem of value.

Allow me the use of a metaphor, one with which you are all quite familiar.

So think of search. What is search? Well, search is a database of everything that is worth knowing about on the web. It's made by a crawler that pings web real estate and creates an index/database of what it finds. It's served up as an application through a user interface that takes your queries and matches them to the best results in that database.

Simple, but that simplicity largely fueled Web 2 as we know it.

Now consider a new dataset for search, the dataset owned by DigitalGlobe. The "crawlers" are DigitalGlobe's satellites. The "real estate" being pinged is every square foot of the earth. As with the web, some parts of the world are worth pinging more often than other parts. ("We don't hit Greenland very often," Dr. Scott told me. But during the Olympics, the company took a picture of Beijing *once every 8 seconds.* Imagine if this technology was around during Tiananmen). The data that satellite crawler captures is stored in a vast index/database. And that index is served up as a product through a UI, though in DigitalGlobe's case, the UI is not yet scaled to a mass consumer use like Google.

Wait, check that, it is, in a way. DigitalGlobe provides the imagery you see in Google Earth and Microsoft Virtual Earth. And while that information is really cool, and provides the foundation for a huge number of interesting applications (and controversy), things get really interesting when you bring two key pillars of search into the equation: Freshness and comprehensiveness.

Freshness is what is sounds like - how often does the crawler check back to the source and see what might have changed? And Comprehensiveness is equally self-describing - but in the case of satellite imagery, it's not so much how *much* of the earth you have in your database (that would be the whole darn thing), but rather, how high the resolution of that data can be.

The data fueling Google and Microsoft's web applications is good, but it's not very fresh, and it's resolution is limited. But that doesn't mean DigitalGlobe doesn't have far fresher data and way better resolution. It does. It just doesn't sell it to Google. (And as I think about the company, I can't help but think Google or Microsoft must be sharpening their pencils, sketching out scenarios for how they might acquire DigitalGlobe. But I get ahead of myself).

Imagine a time when DigitalGlobe's crawlers scale across every square inch of the (interesting bits of the) earth at second-by-second freshness - the way Google's crawlers do for the Web. And imagine a time when the data from this crawl becomes available to all of us, in near real time. Is it possible? Of course it is. You need more satellites, more CPUs, more storage, and some pretty amazing UI and use cases.

Far as I can tell, we have those components already made, just like Google's infrastructure was not so much about its component parts as it was about how they were put to work in the service of a culture changing service.

Is your mind blown yet? Mine is, but then again, that happens a bit more frequently than your average bear, I'll admit.

Back here on earth, I asked Dr. Scott two questions that bear repeating. First, who are DigitalGlobe's largest customers (and how did they use the data)? Far and away, he said, the company's largest customer is the US Government. Why? Well, they buy high resolution data of, say, a particular Afghan village, datestamp yesterday. Then they give that data to soldiers on the ground, who go into that village and ask folks questions like "What were those heavy loads being moved around in the town square by these five men at around noon yesterday?"

Why, might you ask, why doesn't the US use its super secret spy satellites to give ground troops this data? Well, because the information on those spy satellites is classified. It's super secret. But DigitalGlobe's information is commercial, and unclassified. In essence, the US Government uses DigitalGlobe for the same reason it uses FedEx to move military supplies around the world: it's just faster, better, cheaper, and easier.

OK, so there's the answer for why the US Government is such a big customer (and it's not just military, of course. There's NASA, there's NIH, there's Agriculture, you get the picture, no pun intended). What was my second question?

Well, my second question was informed by the concept of search and my rhapsody around the implications of the world as a database. Might DigitalGlobe consider offering a fresh, high-resolution database of its imagery to developers world wide - replete with business rules for commercialization? Imagine the use cases - for the images are not simply images, they are laden with latent meta-data - interpretive data on everything from how crops are growing to how traffic is moving to how governments are treating their citizens.....might DigitalGlobe consider doing such a thing?

"That would be cool," was Dr. Scott's only answer (he is an officer of a public company, after all.)

It sure would be. That would be so WebSquared.

###

*From the company's own product descriptions:

DigitalGlobe’s CitySphereTM product features 60 cm or better orthorectified color imagery for 300 pre-selected cities worldwide. These GIS ready cities are available as off the shelf products and ready for immediate delivery.

With over 37 million km2 of 3 inch to 2 foot resolution color imagery of select American and international markets, DigitalGlobe’s Orthorectified Aerial Imagery is part of our complete offering of the most current high resolution aerial and satellite imagery and the largest library of earth imagery available anywhere. In addition to the largest library of aerial imagery anywhere, we maintain a complete, highly accurate USA basemap at 1 meter resolution or better, with major cities at 6 in to 2 ft resolution.

Today my company Federated Media announced a new ad format for a group of our publishing partners. We call this beta program "Ad Stamp", and those of you who've been watching the space closely, and reading my thoughts on marketing here, won't be too surprised by what you see.

However, with Ad Stamp there is more than meets the eye, and I wanted to think out loud a bit about why I believe this format works, and how it might reflect some of the trends I've been watching and commenting upon in this space for years.

First and foremost, what is most striking about Ad Stamp is how much space is dedicated to the marketer's message (see image at left - the temporary and one time pushdown at the top is pushed back up in this mock up). Ad Stamp coordinates three large units across roughly 50% of the total space available on a site - an "ad edit ratio" not unlike most premium magazines. An initial visceral response might be "That's too much!", but I don't think that's how audiences are going to react.

Why? Because in the main, I think the rise of ad networks and the relegation of marketing impressions to increasingly competing "third rails" on the sides and tops of sites has created a "Nascar effect" where more than five - if not 15 - messages blink numbly and disparately at their subjects. This is not a quality environment for readers or brand marketers, and it's a premium publisher's job to create a quality environment for both. (For a longer treatise on this see my post "The Rise of Independent Media Brands Online").

It's our belief that delivering 100% of the real estate reserved for marketers to *one marketer at a time* could be part of a strong solution to this concern. Ad Stamp, while still an early test program (and one we hope to roll out to all our sites) does just that. The authors of sites involved in our initial test - sites like Serious Eats, Mashable, Apartment Therapy, Business Insider, Dooce, and Boing Boing - all responded positively to early mockups of Ad Stamp, and all for the same simple reason: It makes the site look better.

Looking good is just one part of the thinking behind Ad Stamp. Other premium publishers are doing similar, larger executions (see the OPA news for more), but FM takes a decidedly social twist, as you might expect. To that end, an equally, if not more significant part of Ad Stamp is a new unit we call "the Conversationalist."

The Conversationalist unit (an early execution is shown below) takes some of the best work FM has done over the years (content-driven, conversational ad units), and brings it full circle into the realm of high quality brand marketing. The thesis is this: When a reader comes to the page, he or she initially sees the uncluttered, focused brand message via the coordinated pushdown and tower on the side. (Both of these units are now quite standard across the premium publishing web, but are not often coordinated from a creative and messaging standpoint.) Given that FM sites are A/ a branded environment; B/ a conversational media environment; and C/ that brands are conversations; the next step is pretty logical for an enlightened marketer: Provide the reader with a space where he or she can converse with the brand.

That's where the Conversationalist comes in. Developed in part through work FM did with American Express, Microsoft, and many others, the unit can pull in and curate nearly any conversation deemed relevant by the marketer. Nearly every brand on the web now has Twitter, Facebook, and blog presences, for example. Some have an extremely sophisticated approach to social media (witness American Express Open's Open Forum or Asus and Intel's WePC, for example). In short, brands are becoming social media publishers, and they have a lot to say, and they are increasingly ready to begin a dialog with their customers. The Conversationalist is where they can do just that.

Consider the scenario of a movie campaign, for example, or a mobile phone launch. Both types of campaigns are driven by awareness - the marketer wants to announce the presence of something new and timely. Ad Stamp provides a large canvas for just that. But both campaigns also create a ton of conversation across the Web. The Conversationalist provides a place to curate and add to that dialog - via Twitter and Facebook feeds, blog search, and more.

We've noticed that ads which offer up a chance to join a dialog or engage with contextually relevant content perform one to four times better than ads without these features. It's my belief that combining a clean, clutter free environment with the opportunity to converse is a strong alternative to the Nascar-network blight that seems to be creeping into high quality conversational sites.  

For now, Ad Stamp is limited to about 20 sites in the FM family, in two distinct categories - tech/biz (around 11 million uniques) and Home (about 10 million). Should this new format prove successful, we'll roll it across all of FM, and it's my hope the rest of the industry will adopt similar formats. We're all in this together.

In summary, Ad Stamp is a response to what I wrote in a previous post about all of this more than a year ago:

Brands are, in essence, defined by the conversations your consumers have about your products or services (and yes, I am indebted to Cluetrain and Ogilvy and any number of other great thinkers, even Hopkins, who might justifiably be the bridge between direct response and brand advertising).

Brand advertising in traditional media has been about getting in between the ears of a target consumer in some way and "building brand equity" through media executions. In essence, brand advertising has been, up till now, an attempt to influence the conversation that potential consumers will have after experiencing the advertising.

With conversational media and marketing, that concept is time shifting. Now brand advertising can *join* and even *initiate and convene* those brand conversations. And that requires a different skill set, one media folks are just starting to explore. To date, we've just begun to figure out how to execute marketing in this new form of media in ways that work for all parties concerned - the content producer, the marketer, and the consumer. But that doesn't mean we won't. It just means we have very interesting work ahead of us.

I am thrilled that by working with the amazing folks at FM and our extremely thoughtful publisher and marketing partners, we're taking what has been a lot of theory on this site (OK, call it bloviating if you wish) and turning it into very real advances that are becoming reality in the field. I feel very, very fortunate. And as always, let me know what you think, as your input over the years is what has always led my thinking.

Nielsen's first half Y/Y comparison numbers came out for the ad industry yesterday, and as one might expect, they were not pretty. The Web did not escape unscathed. SAI has a nice chart, reproduced here.

Update: Comscore Chair Gian Fulgoni notes that this data does not include display ads with search, CPC or CPA model...

I live in the Bay area, a place that has been, in the past 20 or so years, woefully underserved by what those in the quality news business call, well, quality news. I also am a graduate of a fine Bay area quality new journalism program, and I taught there as well. And before I started my career in technology journalism and entrepreneurial pursuits, my first ever idea was to create a "quality" newspaper for the Bay area. (That's the late great New West magazine at left, started by legendary editor Clay Felker. If he couldn't make it happen, not sure anyone can.)

So imagine my merriment when I read this piece in the NYT entitled The Wall Street Journal and The New York Times Plan San Francisco Editions.

Oh joy! Finally, a place for quality local news! Right?

Not so fast.

The lede of the piece:

Both The Wall Street Journal and The New York Times are planning to introduce San Francisco Bay Area editions, hoping to win new readers and advertisers there by offering more local news, in what could be the first glimpse at a new strategy by national newspapers to capitalize on the contraction of regional papers.

Now, I'm pleased as punch that the two majors want to give me and my neighbors a quality alternative to the failed local papers, but unless the pay attention to some pretty specific realities about this place, I don't imagine it's going to pan out for them in terms of ROI for effort expended. So here are a few thoughts, should either or both decide to focus on our odd little patch of Northern California paradise.

First off, no one in Concord cares a whit about news in San Francisco, unless the Bay Bridge is broken. This is a principle of hyperlocalism, and it's very, very distinct here in the Bay area. For decades editors have been trying to crack the code of what makes the Bay area hang together as a region, and they've all failed. Marin folks simply don't care about what's up in Palo Alto, and those who live in Noe Valley barely care about those who live five miles across town in the burgeoning SOMA neighborhood. If you want to have a local edition of a national newspaper here, you're going to have to figure out a way to cover stories all these folks care about. I'm not sure it's possible....unless....

...unless you focus on the local Bay area stories that we all care about: the ones that have national scope, and cover them with the same rigor and depth that you would any major national story. Now you'd be cooking with gas.

Those stories are, in no particular order:

- Technology and the Internet. No national paper comes close to owning this story (the way The Industry Standard did in the late 90s, or a handful of blog sites do now). There is a serious opening here for determined, high quality journalism. The WSJ already has All Things D, and the Times has a strong passel of reporters already here on the ground.

- Biotech/Health. I break it out because it's a massive story, and totally undercovered. The impact of genetic research and massive drug companies' agendas on policy, for example. The Bay area is one of several key centers of R&D and business in this area.

- The sustainability story. Again, the Bay area leads here, it's not just for hippies or rich liberals anymore.

- Real estate. Everyone cares about the value of their home, and this area is a major story in that regard - some of the highest foreclosure rates as well as the highest home prices within miles of each other. And commercial real estate is huge here as well.

- Asia. Making this very large story approachable to a local audience is key. The Bay area is deeply connected to Asian culture and business but I've not seen great reporting that makes that connection meaningful on a regular basis.

- Food and wine. Sorry, New York, but all the good stuff gets made here. (OK, that was hyperbole but no one can argue with Napa, Sonoma, and other amazing terroirs, and the restaurant culture alone is a major story).

- Sports. We all love our teams - The Giants, the 49ers, the colleges (Cal, Stanford in the main), and the Sharks. This is one thing our local paper does reasonably well.

If the WSJ and/or the NYT can create a "local" edition that *owns* these stories and tells them in a way that makes them meaningful to Bay area residents in a way that transcends traditional local blandishments, I can see a pretty strong audience developing for the product.

But then I look at the other side of the equation: The business proposition. Let's say the two papers create a strong local edition along the lines of what I've outlined above. Folks like me would be thrilled (I'd probably reconsider my decision some years ago to stop subscribing to both papers, though I'd want them online). Would that be enough? Probably not. You need regional advertising to truly make money in the news biz. So will strong local editions mean national papers sell more local advertising? To me, that's a very open question.

The advertisers that once filled the pages of the local papers here - car dealerships, department stores, Frye's electronics, Shaneco jewlers and the like, seem to have found new channels of communication for their customers. Most of those channels are online. I wonder, what will these national/regional plays do online? How will they go to market online? It's an interesting question, and one that will have to be resolved before these editions truly find their footing.

The NYT asks today: "Is Google Entering the Mortgage Quote Business?"

The story notes that in a lawsuit between two mortgage-lead businesses, Lending Tree and MorTech, Lending Tree claims that MorTech is providing its technology to Google, so that Google can compete with Lending Tree.

Does this mean Google is getting into the mortgage business?

Of course it does. And ... of course it doesn't. Because Google already owns the market.

Google is in the lead generation and arbitrage business. It has been since the birth of the auction on AdWords and the spread of syndication through Adsense. Google makes billions on arbitraging leads. And very few markets are as rich in lead generation cash as the mortgage business.

So, in a way, Google already is in the business. And always will be. The company admitted to the Times that it is testing a new approach to this lucrative market that optimizes returns, and why not? Do a search for Home Mortgage. There's a lot of demand out there for leads. Google smells an opportunity to cut out a middle man, and increase margins.

Reminds me of a certain company back in the early 1990s...

(image)

Very interesting news yesterday about Google Adsense and competing ad networks. From ClickZ:

Google plans to open its AdSense network to other ad networks, potentially giving the already huge ad net access to display ads flowing through countless other networks. The firm yesterday said it will allow networks to bid via auction to have their ads appear on AdSense partner sites, like an exchange. Google is vetting several ad networks for certification, but would not name any of the networks. If accepted into the program, the networks would receive payment if their ads win the auction to appear on AdSense sites. The firm said networks will be able to target contextually or by placement. The company suggested the offering will help boost publisher revenues by increasing competition for ad placements.

Now this can be seen a number of ways. First, is this an admission by Google that they do not have good enough display advertising inventory and/or relationships? Maybe, maybe not. Seems to me more of a statement that Google considers Adsense more of a platform for advertising, rather than a network into itself. Second, if you ran an ad network, would you want to do this? Well, ad networks tend to optimize for the most money. If Adsense gives them more money, they just might want to do this. Third, what about the data? Google will learn an awful lot about what is going on with each network once they plus themselves into the Adsense hivemind.

And in the end, isn't that what it's all about? Remember what happened with search? AOL, Netscape, Yahoo, and many others fed the Google search beast until Google had all the data and therefore the best search engine. When it came time for renegotiation of those search deals, who had the upper hand?

It's all about the data, to my mind.

Google's new iGoogle upgrades smacks of Facebook. Read this:

we're excited to introduce social gadgets for iGoogle. Social gadgets let you share, collaborate and play games with your friends on top of all the things you can already do on your homepage. The 19 social gadgets we're debuting today offer many new ways to make your homepage more useful and fun. If you're a gaming fanatic, compete with others in Who has the biggest brain? or challenge your fellow Chess or Scrabble enthusiasts to a quick match. Stay tuned in to the latest buzz with media-sharing gadgets from NPR, The Huffington Post, and YouTube. To manage your day-to-day more efficiently, check things off alongside your friends with the social To-Do list gadget. Your friends are able to see what you share or do in your social gadgets either by having the same gadgets on their homepages, or through a new feed called Updates. Updates can include your recently shared photo albums, your favorite comics strips, your travel plans for the weekend and more.

Updates, Status Updates, Tweets....whathaveya. It's all the same play - a social platform for connecting to others. More:

It's developers who have really made iGoogle into the rich experience it is — growing our gadget directory to over 60,000 gadgets today — and we know iGoogle developers will help us quickly expand our collection of social gadgets. You can get information about how to build social gadgets for iGoogle on our developer site: code.google.com/igoogle. We introduced these new social features recently to Australia users and are gradually rolling them out to users in the U.S. over the next week.

Developers developers developers developers....