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Will Yahoo Bing? Pay Attention to the Display Side

By - July 27, 2009

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We’ve been talking about a search deal between Yahoo and Microsoft for so long (no, really, read this piece I wrote over two years ago) that it feels, to me anyway, like the deal’s already been done. But it hasn’t.

Today new details are coming out, thanks to a report in Ad Age (Ad Age? Breaking search news? I really must get back to reporting, eh?). While there’s nothing particularly new in the report – Yahoo will sell ads on its own site as well as Bing.com, Microsoft will focus on the technology, and both will split revenues – what is new is the claim that the deal will be announced “as soon as this week.”

I for one sure as heck hope it will, so we can move on from this slow motion train wreck of a negotiation. Valuable time has been lost – with clarity, both teams can focus on competing and winning, rather than arguing over a diminishing share while Google runs away with the game.

Which raises the question: “What *is* the game”? It’s one worth asking.

It’s very clear that Yahoo and Microsoft should partner on search. What I find more interesting is whether they will partner on display – both companies have major ocean-boiling platforms in development, and neither seems anywhere near where they should be. This is an area where Google is vulnerable.

What do I mean? Well, Yahoo bought Right Media and a few other ad network plays, and pre Bartz, was intent on creating a soup to nuts display marketplace. Microsoft bought Acquantive. Both did so in response to Google’s purchase of Doubleclick. While the first wicket of the search game is over and Google has won, display is another beast entirely. Billions of dollars have been invested in owning display inventory and platforms, but it’s not clear those dollars will return effectively. For now, they seem content to focus on what’s called “performance display” – in other words, display ads driven by the same direct-response mentality as search.

There’s certainly a good market out there for performance display, but it’s not a game changer. The game changer is in building a platform which works for the other side of the marketing equation: branding. And as far as I can tell, none of the major players seem to be paying attention to that opportunity. They should be.

I’ll be writing more on that topic in the coming weeks.

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Twistory 101: It's All About Small Business

By - July 24, 2009

biztweetbird.pngThe world’s abuzz this week with word that Twitter is getting serious about business – the proof point being Twitter’s new subdomain “business.twitter.com” and the “Twitter 101” handbook currently living there, a white paper of sorts aimed at helping companies figure out how to leverage the sometimes befuddling service.

This all reminds me of Fall 2004. Back then, Google was coming on hard in search. And while the world viewed Google as an upstart stealing query share from the incumbent Yahoo, the real drama was happening on the business side. By the Fall of 2004, Google’s AdWord and AdSense solutions were warranting serious attention from the same ecosystem of SEO/SEM that previously had focused on Overture’s offerings.

In this Fall, 2004 thread on Webmasterworld, where SEO types hang out to talk shop, search marketers debate the relative performance and profitability of Overture compared with Google. Prior to that year, Overture was the undisputed king of paid traffic. But in ’04, Google started pulling ahead, and since that time, it’s never looked back. Why?

Well, there are myriad reasons: Google had a better consumer facing search experience than Yahoo (Yahoo bought Overture in 2003), and Google’s AdWord service including a quality ranking score (as well as paid ranking like Overture), for example. But I believe something else was at work, an upward spiral of adoption by small business advertisers.

What do I mean by that?

Well, I was covering the search space pretty closely back then, and one of the metrics touted by both Google and Yahoo were the number of advertisers who were using their service. Google didn’t publicly announce those numbers, but my sources inside the company did whisper them to me from time to time. Overture, on the other hand, touted their “active advertiser” numbers in their public filings. Its number of active, paying advertisers crossed 100,000 around the time of the Yahoo acquisition, and upwards of 200,000 a year later. Who were all those advertisers? That early in the search revolution, they sure weren’t the Fortune 500, or even the Fortune 5000. They were SMBs – the lifeblood of the US economy, responsible for two thirds of jobs and the driving force of a nascent recovery from the 2001-03 recession. These businesses live on the edge of profit at all times, and they are always the first to find tools that might help them succeed. By ’04, tens of thousands of them had found paid search.

As far as I could tell, Yahoo stopped disclosing the figure after the acquisition closed. And as I was strolling the halls of the first Web2 conference (October 2004), I got a phone call that might explain why. The call was from a source at Google, who wanted me to know that Google had eclipsed Overture in the number of total active advertisers. I couldn’t confirm that number, nor could I get Overture/Yahoo to respond, so I dropped the story (can you imagine a blogger in the tech world not printing a story like that now? How times change.).

twit101.pngAnyway, I was reminded of this anecdote while reading through “Twitter 101” and it occurs to me that to really succeed, Twitter must be useful, really useful, to small businesses. It was those tens of thousands of small businesses who drove success at Overture, and then at Google. Search became an essential channel for lead generation, and Google became the dominant player in that channel.  

Billions ensued.

While a lot of the attention around business success on Twitter focuses on big brands like Comcast, JetBlue, or WholeFoods, the ecosystem that will really drive value, revenue, and profit for a TweetSense like execution will be the small business ecosystem. And absent a clear service like AdWords for Twitter, a user manual of sorts that explains why Twitter can help business makes an awful lot of … tweetsense.

SIGIR This Week

By - July 20, 2009

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I don’t write that much about core geeky search stuff here lately, but I still get a bit excited when I am reminded that once again, ACM’s SIGIR is happening. It’s always fun to take a look at the agenda and see who is speaking and presenting papers. And taking a look at the papers tells us something about what’s up in search, who’s adding value to the academic search community, and on what topics.

Microsoft has a stamp on this show, with, according to Microsoft, nearly 30% of all papers presented at the event.

Can 20 folks Make Bing? Nah.

By - July 15, 2009

Since vacation last week I’ve been on the road constantly, and unable to find much time to write. But this NYT Op Ed, by Robert Cringely, caught my eye, as it addresses something I’ve been watching closely for some time – the competition between Microsoft and Google. Clearly the two giants are circling each other’s core revenue streams – Google announced a vapor competitor to Windows last week, and Bing is Microsoft’s answer to Google search. (Disclosure: Both companies have sponsored this site in the past, and Bing is sponsoring it now (see BingTweets), and both companies work with FM, my business). google-windows_1439540c.jpg (image credit)

So it makes sense that there’d be a fair amount of speculation on what it all means. But Cringely’s take, validated as it was in the pages of the Times, struck me as worthy of thinking through. In it he argues:

This is all heady stuff and good for lots of press, but in the end none of this is likely to make a real difference for either company or, indeed, for consumers. It’s just noise — a form of mutually assured destruction intended to keep each company in check.

I don’t agree, to a point. I think it’s true that outside of core search and advertising platforms, Google tends to throw a lot of pasta at the wall, in the hopes that some of it will stick. But Google is dead serious about cloud computing, and I very much doubt they’ll abandon Chrome OS. And I’ve spent a fair amount of time with the team behind Bing, and I think Microsoft is equally serious about this effort.

Cringely continues:

What Google’s chief executive, Eric Schmidt, has to fear more than anything else is that he’ll awake one day to learn that the Google search engine suddenly doesn’t work on any Windows computers: something happened overnight and what worked yesterday doesn’t work today. It would have to be an act of deliberate sabotage on Microsoft’s part and blatantly illegal, but that doesn’t mean it couldn’t happen.

The idea that Microsoft would do such a thing strikes me as patently ludicrous. Microsoft has learned its lesson with the DOJ, and it’s not going to run down that alley again. I am certain there are many other things about the company that keep Eric Schmidt up at night, but this is not one of them.

Cringely continues with what struck me as a very misinformed statement:

The engineering teams for any of these products are, at most, 20 to 30 people….Bing hasn’t a hope of toppling Google as the premier search engine and Microsoft knows it.

Wow! Did Microsoft really make Bing with a team of 20-30 folks?! And Microsoft is just doing Bing to keep Google on its toes?! I had to ask. Here’s Microsoft’s official response: “This is inaccurate. The Search and Advertising platform engineering team is in the thousands…(and) We are in the business to succeed long term.”

Now, success doesn’t have to be toppling Google, I think Microsoft would settle for gaining five to ten points of share this year, and continuing to show share gain over the next few years. The company posted some examples of early success earlier this week, and while Bing has its detractors, it’s clear the new engine has had a pretty successful initial launch. It remains to be seen if that momentum can continue, and if the concept of search as an application can scale.  

A Wish List for Facebook Search

By - June 17, 2009

It’s taken a while, but I finally have time to rewrite the post I wrote this morning about Facebook search. For some reason my blog editor ate the post, something that has never happened to me and really threw me off.

In any case, this morning I noticed a post on Mashable about Facebook’s new “superfresh” search plans – in essence, a plan to make the Facebook newsfeed searchable, and most impressively, to filter that through your social graph. In short, this is a Twitter search competitor with a Facebook twist, and while I think it’s a fine move, it’s nowhere near where Facebook needs to be in terms of search, and it seems a bit myopic: Facebook is way more than its newsfeed, and its search play is key to proving that value, and extending it.

First, a minor rant. Facebook search circa 2009 is akin to Alta Vista search circa 1994, or Ebay search circa 2004: very dumb and entirely lacking in structured, intelligently parsed data. In fact, it’s worse that those two examples. It’s clear that there are almost no intelligent signals in the way Facebook does its internal search, and I can’t imagine anyone is happy with it. A few examples:

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Here’s a search for “john battelle status” as of today. There are no results. How on earth can that be? Not even a referral to my status updates? The engine clearly doesn’t understand the concept of “status” which on Facebook, seems a crime.

Here’s another one:

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This is a search for “graffiti application”. It does not find the popular application, Grafitti, which has more than 10 million installs and over 2 million active users. Whaaaa?

I could go on and on, but that’s not the point. The point is, Facebook search could get a lot better. And I am *sure* the company is deep in planning on how to take its search to a new level – no small feat, given the size and scope of its service. No doubt building Facebook search today is akin to building Google ten years ago – bigger, most likely, in terms of data, algorithmic, and platform challenges.

So given the company is working on it, let’s give them some input. What do we want it to be? Here are a few ideas I have, I’d love to hear yours:

– Leverage the social graph in search. When people search for other people (most likely the highest percentage use case on Facebook), show me that person’s friends. Linked In does a very good job of search features like this, and is only getting better at it.

– Rethink how results are presented. Currently, it’s all about pages on Facebook. Why? Why not think about search results in a similar manner to how we all understand search – multiple results, easily scanned, with short descriptors of what the link will bring us? There’s a lot of room to innovate on top of this interface, but it’s table stakes at least.

– Make search social. Show me what others are searching for, trending searches on the service, popular “found” items. Search is a signal, use it!

– Make search results linkable. When I do a search on Google, I can link to it. Here’s a link to a Google search for “graffiti application,” for example. And yes, the first result is the right one…

– Give me image search. I want to see pictures related to the results – Facebook is a highly visual service, so surface that!

– Integrate Facebook Connect. How cool would that be, to see results from websites that have integrated Facebook?

These are off the top of my head (for the second time – I had others that I cannot recall…), but you get the picture. What do you want to see in Facebook search?

Hunch

By - June 15, 2009

hunch-logo.png I have not yet grokked Hunch, the decision engine from flickr co-founder Caterina Fake and co., but from the coverage, the launch is a hit. Here’s Caterina’s post announcing it…

Microsoft Goes After Click Fraudsters

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It’s been a while since I’ve seen click fraud in the news, but this Times story caught my eye, in particular because it was Microsoft. Google usually gets all the headlines around this issue, but it’s interesting to see Microsoft leading the charge in this arena. The story is worth reading, it sheds some light on the darker underpinnings of the search economy. From it:

Microsoft’s theory is that Mr. Lam was running or working for low-ranking sites that took potential client information for auto insurers. The complaint said that he directed traffic to competitors’ Web sites so they would pay for those clicks and exhaust their advertising budgets quickly, which let the lower-ranking sites that he sponsored move up in the paid-search results.

When people clicked through to his site, it asked them to supply contact information, which he then resold to auto insurance companies, according to Microsoft’s complaint, which estimated his profit at $250,000. In the complaint, it also said it had to credit back $1.5 million to advertisers because of the Lams’ alleged fake clicks. Microsoft is seeking $750,000 in damages from the defendants.

Although small advertisers have sued search firms, complaining the firms did not do enough to prevent fraudulent clicks, this is among the first cases where a search provider has gone after a suspected perpetrator.

Facebook's Namespace Land Grab? Or Maybe…It's Just Useful

By - June 11, 2009

Much buzz over the past few days about Facebook’s plans to let folks (and, ahem, brands) claim their namespaces on Facebook. IE, Starting this weekend, I should be able to claim www.facebook.com/johnbattelle, just like I already “own” www.twitter.com/johnbattelle (sort of).

Anil Dash has a very funny send up of all this in a future forward timeline satire here. His point is – why is everyone falling all over themeselves to get their vanity URL on Facebook – or Twitter, or anywhere else for that matter – when the web is an open place and anyone can get their own URL, after all.

Well, yes and no. I’ve been complaining about Facebook’s terrible link structure for a long time. We all spend time there, and create and share value there, but up till this weekend, it’s been very difficult to point folks to places *inside* Facebook from places *outside* Facebook. The future of the web is ecosystemic – it’s not about being in one place – this blog, that Twitter feed, or that Facebook page, it’s about the ability to be anywhere, depending on the context and the moment. Sewing it all together is critical, and this move should make Facebook that much easier to incorporate into an ongoing, web wide conversation. I hope.

Blind Search Site – Bing, Yahoo, Or Google?

By - June 08, 2009

blind test.pngQuite the kerfuffle brewing over this site, built by a Microsoft employee, given folks the chance to blind taste test Bing, Google, and Yahoo. Bing was doing well early, but that might be due to the fact a lot of Microsoft folks took the test first. In any case, SAI has a good write up of the whole affair...  

My issue with this is that it’s just about ten blue links. Bing in fact is about an application, including a good UI, on top of the base of ten blue links.