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The Signal Weekly: 1.14.2011

By - January 14, 2011

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Most of you know by now that I do a short summary of the day’s news over on the FM Blog. This year I’m going to try to do a Friday summary of the week’s Signals here on Searchblog. Here’s the first of the year:

Monday Signal: The CES-less Hangover

Tuesday Signal: Murdoch and Jobs and Verizon, Oh My!

Weds. Signal: Do We Have a Quora Yet?

Thursday Signal: Internet By the Numbers

Friday Signal: Enjoy You Some Weird.

If you want Signal each day, sign up for the email newsletter on the site (top right), or grab the RSS Feed.

Have a great weekend!

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No, In Fact, We Haven't Seen This Movie Before

By - January 13, 2011

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Thanks to monster private financings from Groupon and Facebook, as well as the promise of major IPOs from Demand, LinkedIn, Zynga and others, the predictable “watch out, here we go again” buzz is rising up in the press. This article from Ad Age, subtitled “With Billion-Dollar Dot-com Valuations Back in a Big Way, It’s Time for Alarm Bells to Start Ringing,” is typical of the bunch. With a “we’ve seen this movie before” tone, it points out that most of the successful companies of today had models that were tried ten years ago, and in the main they failed.

But I’d like to point out a couple pretty obvious differences between the dot com busts of a decade ago, and the companies that are now earning billion dollar valuations. To wit:

- Each of the companies earning these valuations have revenues in the hundreds of millions or more, and operating profits in the tens of millions, if not more. Most also have operating histories of many years, and/or executives and boards who have extensive histories operating in the Internet economy.

- The markets overall have changed dramatically, on many different fronts. First of all, nearly every consumer in the developed world is comfortable spending money using the web. Second, the web is firmly a mobile medium, enabling business models that were mere dreams a decade ago. And third, the markets have been mostly closed to public investment in the “Internet thesis” for most of the past ten years, so there is a very strong pent up demand to invest in what many see as the future of how business will be done.

Combine these factors and you have what I view as a pretty solid environment: a strong demand for quality companies, and quality companies to fulfill that demand. Is $50 billion too high for Facebook, or $5billion too high for Groupon? Well, we’ll see. As the initial surge of IPO demand abates, newly public companies will prove their value in the long term by delivering growth. At least they have strong platforms of revenues and profits, as well as extraordinary market positions, from which to start. Remember, Google went public in 2004 at under $100, and nearly everyone thought the company was overvalued.

Back in the dot com era, most retail Internet investors were buying on the come, on promises that the hand waving and affirmations of Web 1.0 entrepreneurs would magically come true. Almost none of the companies that went public back then could boast the metrics today’s private winners do. Truth be told, the promises of the Internet hand wavers are coming true, but for investors in the 1990s, it’s a decade too late.

We’re in an entirely different place, as an industry, than we were ten years ago. I very much doubt we’ll see the same mistakes made again. If money losing companies with nothing but an idea and some VC backers manage to go public, I’ll be the first to write a post about our collective amnesia.

And this is not to say that marginal companies won’t attempt to go public in coming years, or that there won’t be flameouts and losers over time. There always are. But compared to the late 1990s, the companies lining up to offer themselves to the public look healthy, well positioned, and very, very real.

Yahoo IPO vs. Facebook IPO

By - January 10, 2011

From Paid Content, a tale of two very different eras:

Yahoo In 1996

Age: 1 year

Annual sales: $1.3 million

Net loss: $0.6 million

Total raised in IPO: $33.8 million

Market value at close: $848 million

Employees: 49

Facebook In 2012

Age: 8 years

Annual sales: $1.2 billion-plus

Net income: $355 million-plus (2010 estimates)

Last valuation: $50 billion

Employees: 2,000-plus

What Everyone Seems to Miss In Facebook's Private or Public Debate…

By - January 04, 2011

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…is the core reason it makes sense for Facebook to be public: Accountability to its customers. The rest of this debate is simply financial folks arguing amongst themselves.

Facebook is the greatest repository of data about people’s intentions, relationships, and utterances that ever has been created. Period. And a company that owns that much private data should be accountable to the public. The public should be able to review its practices, its financials, and question its intentions in a manner backed by our collective and legally codified will. That’s the point of a public company – accountability, transparency, and thorough reporting.

If Facebook wants to stay private and not be part of the social mores which we’ve built that govern major corporations (flawed though they may be), well I think that would be a major strategic blunder, one that would ultimately doom the company. It’s fine for all sorts of companies to stay private, for all sorts of reasons. But a company like Facebook, with its unprecedented grasp of our social data, should be accountable to the public. If it isn’t, we’ll migrate our “social graphs” to a company that is.

If Zuckerberg doesn’t want to be a public CEO and deal with the realities of that, as this Reuters piece argues, well, he should find a CEO who is willing to do the job.

(If you’re not up on the debate, here’s a primer.)

Predictions 2011

By - January 03, 2011

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InnostraD-tm-3-tm-tm-tm.jpg the eighth version of my annual predictions, I’ll try to stay focused and clear, the better to score myself a year from now. And while I used the past two weeks of relatively fallow holiday time as a sort of marination period, the truth is I pretty much just sat down and banged these predictions out in one go, just as I have the past seven years. It works for me, and I hope you agree, or at least find them worth your time. So here we go:

1. We’ll see the rise of a meme which I’ll call “The Web Reborn” – a response to the idea that mobile and apps have killed the web as we know it. In fact, we’ll come to realize that the web is the foundation of nearly everything we do, and we’ll start to expect, as consumers, that all our service providers honor and build in basic principles of “web friendliness” – data portability and user-controlled identity most important among them. Call it a return to the original principles of “Web 2.0″.

2. Voice will become a critical interface for computing (especially mobile apps). This is just not true now, but in a year’s time, there will be a handful of very popular apps that are driven by voice, and in particular, by weaving together voice, text, and identity.

3. DSPs (Demand Side Platforms) will fade into the fabric of larger marketing platforms. In the end, DSPs are the handle by which we understand the concept of technology-driven ad networks. And those have been with us for over a decade. Exchanges, DSPs, SSPs, etc. are all important, but in the end, what matters is that advertisers have scale and efficiency, and consumers have control.

4. Related, MediaBank will emerge as a major independent player in the marketing world, playing off its cross channel reach (outside of digital) and providing an alternative to the conflicted digital platforms at Facebook, Microsoft, Google, and Yahoo. I could imagine a major tech or telco player trying to buy MediaBank as the world realizes that marketing is, in essence, a massive IT business (among many other things).

5. The Mac App Store will be a big hit, at least among Mac users, and may well propel Mac sales beyond expectations.

6. Related, Apple will attempt to get better at social networking, fail, and cut a deal with Facebook.

7. Also related, Apple will begin to show signs of the same problems that plagued Microsoft in the mid 90s, and Google in the past few years: Getting too big, too full of themselves, and too focused on their own prior success.

8. Microsoft will have a major change in leadership. I am not predicting Ballmer will leave, but I think he and the company will most likely bring in very senior new talent to open new markets or shift direction in important current markets like media/marketing/social.

9. The public markets will be surprisingly open to major new Internet deals, despite the current rise of “private IPOs” and the growing belief that the IPO process is broken. In the end, there’s just too many good reasons for public companies to be, well, public. (See Gurley).

10. The tablet market will have a year of incoherence. Apple will dominate with the iPad due to a lack of an alternative touchstone. Google will focus on providing a clear, consistent experience through Android for tablets and mobile, but it will take a third party to unify the experience. I don’t see that happening this year.

11. “Social deals” will morph to become a standard marketing outlet for all business, and by year’s end be seen as a standard part of any marketer’s media mix. Groupon will lead here, but nearly every major player will have an offering, often by partnering with leaders. I’m tempted to say Facebook will abandon its own Deals offering for a deal with Groupon, but I’m not sure that will unfold in one year.

12. Related, Groupon will fend off an acquisition by a major carrier, probably AT&T or Verizon. It’s possible they’ll sell, but I doubt it.

13. Facebook will decline as a force in the Internet world, as measured by buzz. The company will continue to be seen as Big Brother in the press, and struggle with internal issues related to growth. Also, it will lose some attention/share to upstarts. However, its share of marketing dollars and reach will increase.

14. Related, we’ll see major privacy related legislation in the US brought to the floor of Congress, and then fail for lack of consensus. But that will drive a significant shift in how our culture understands its relationship to the world our industry is building, and that’s a good thing.

I’d love to keep going, but I think those are the major ones, at least from my vantage point. Thanks for reading, it was a great year. I’m not going to make predictions about my own work this year, as I’ve got too much inside knowledge on that topic! Let me know your thoughts in comments, and have a great 2011!

Related:


Predictions 2010

2010 How I Did

2009 Predictions

2009 How I Did

2008 Predictions

2008 How I Did

2007 Predictions

Maybe I Was Right…

By -

In my prediction #7 from last year: Traditional search results will deteriorate to the point that folks begin to question search’s validity as a service.

I gave myself a “fail” on this when I graded myself last week. But Anli makes a case in “THREE’S A TREND: THE DECLINE OF GOOGLE SEARCH QUALITY”.

As for 2011 predictions, I’m working on that right now, and hope to have them out later today.

What … or Where… Are The Great Android Apps?

By - January 01, 2011

Because I want to know. Google, really, really, really. It’s time to pivot your business and make this happen.

More later. Just posting this as a thought after a long talk with my 14 year old son, who wants to write apps. And funny, so do I.

Predictions 2010: How Did I Do?

By - December 27, 2010

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Predictions 2010

2009 Predictions

2009 How I Did

2008 Predictions

2008 How I Did

2007 Predictions

2007 How I Did
2006 Predictions
2006 How I Did
2005 Predictions
2005 How I Did
2004 Predictions

2004 How I Did

Well, it’s that time of year again, time to see how well, or poorly, I did predicting events in the past year. This is my “keep myself honest” post, next week, I hope, I’ll post my predictions for 2011.

So how did I do for 2010? Overall, I’d say it was a mixed year, but by my score, I hit 7 of 12, with 3 pushes and two outright fails. A fair amount is open to interpretation, as we will see. To the results:

Prediction #1: 2010 will mark the beginning of the end of US dominance of the web. This is a pretty soft one to prove, but I think it’s certainly defensible. First of all, the “rest of the world” is growing far more quickly than the US in terms of Internet use, growth, and related development. In the broader economy, China looms large, and is already far larger than the US in Internet population. In terms of startups, I’d have to say we’re not there yet – the US is still the center of innovation, at least for scaled platforms like Twitter, Tumblr, Facebook, Groupon. But I only predicted that this would be the *start* of this shift, so I’d say the jury is out on whether I was right. But hey, Fred agrees with me…Score: Push.

Prediction #2: Google will make a corporate decision to become seen as a software brand rather than as “just a search engine.” I think this clearly happened in 2010. With both Android and Google Apps in the center of its strategy, Google and its partners poured hundreds of millions of dollars into building the Google brand to mean “an excellent software platform” and next to nothing (OK, one Superbowl ad) into the brand meaning “Search.” Score: +1.

Prediction #3: 2010 will see a major privacy brouhaha, not unlike the AOL search debacle but around social and/or advertising related data. OK, maybe this was a layup, but wow, did this come true, in spades. Take your pick, was it Google’s Street View data collection? Or maybe Facebook’s half-year long meltdown, beginning with sharing all data with search, and ending with the Open Graph? (Not to mention Google Buzz!) In any case, privacy has become the center of attention in Washington, with multiple investigations and pending legislation all brewing, in particular around social and advertising data. 2010 will be remembered as the year privacy took center stage. Score: +1.

Prediction #4: By year’s end the web will have seen a significant new development in user interface design. Well, again, I think this one happened. Not only did Gawker “redefine” what a blog is, the rise of the tablet and touch interfaces, as well as shifts to gestural in gaming (Kinect) have shifted how the web is consumed and produced. 2010 was most certainly the year the web pivoted from boring old HTML to a new approach to user interface based on touch and gesture, not to mention voice (which is coming hard on touch’s heels). Score: +1.

Prediction #5: Apple’s “iTablet” will disappoint. I know, I know, it sure seems like I blew this one. But remember folks, the iPad did in fact disappoint, nearly everyone, when it was announced. It was pretty much universally panned for not having a camera, being the wrong size, being a self-contained universe that shunned the open web, Flash, etc. So in a way, I was right. Then again, the thing went on to be the biggest hit since the iPod, so I was wrong too. I’d score this a push.

Prediction #6: 2010 will see the rise of an open gaming platform. Alas, this did not happen. I thought Microsoft would open up Kinect, as the technology has massive potential. So far, it has not, and no one else has done anything either. Score: -1.

Prediction #7: Traditional search results will deteriorate to the point that folks begin to question search’s validity as a service. I think it’s hard to argue with the overall decline in search results as a core driver of web navigation. Social is clearly on the upswing, and in general, the rise of content farms and the stirrings of data wars between Google and Facebook have meant that search is no longer the presumed king of the web. However, I don’t think it got as bad as I predicted it would, so I give myself a fail on this one, but I predict I’m right here in the long run. Here’s more on why. Score: -1.

Prediction #8: Bing will move to a strong but distant second in search, eclipsing Yahoo in share. This happened, depending on who’s counting, and if you take the Yahoo/Microsoft search deal into account, it clearly happened. Score: +1.

Prediction #9: Internet advertising will see a sharp increase…and most predictive models are not accounting for this rise. I was right on this one as well. Not only did online spend eclipse newspaper spend, but online suprised most forecasters with significant double digit (14% at least) Y/Y growth. By comparison, overall ad spending grew just 3% in the US. That’s sharp by my book. Score: +1.

Prediction #10: The tech/Internet industry will see a surge in quality IPOs. Well, I thought this one would be a layup, and instead, it’s at the very least a push. We did have a surge in filings, but we did not see a ton of companies go public, though compared to 2009, one could easily call this year’s lineup a relative surge. It was the busiest IPO year (overall) since 2007, but we did not see action where we might have expected – from Facebook, LinkedIn, Zynga, or even companies like MediaBank. We did see important filings from Hulu, Betfair, Demand and Skype, but neither have made it out so far. In fact, I did make another related prediction: one, if not more will be withdrawn. That happened, just this month, with Hulu. I’d score this one a push.

Prediction #11: We’ll see a major step forward in breaking the man/machine barrier. I honestly don’t know if this came true. I do know that when machines can translate poetry, and the creation of synthetic life, the strong advances in gene sequencing, and the reprogramming of cells, we’re certainly making progress. I’m out of my depth here, so readers, did this prediction come true or not?! For now, I’ll punt and call it a push.

Prediction #12: I’ll figure out what I want to do with my book. Yep, I’ve figured it out. More on that early next year. Score: +1.

So, overall, 3 pushes, 2 fails, and 7 wins. That’s not a bad year. How do you think I did?

Signal LA Agenda Is Up

By - December 23, 2010

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I’m pleased to announce that the preliminary agenda for our first ever Signal conference, Signal LA, is live and online. Signal is FM’s conference series highlighting one major trend in digital media and marketing, in one city, on one day.

First up is Los Angeles, Feb 8th, with a focus on Content Marketing. Check out the amazing lineup:

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Register today, I expect this to sell out. I’m thrilled to be doing more of these high quality events next year. It’s going to be a lot of fun. And it doesn’t hurt that we’re doing Signal LA at the SLS Hotel, which is pretty much the best place going at the moment….

The Year In Writing, 2010

By - December 22, 2010

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This has become something of a tradition at Searchblog (well, OK, it’s the second time in three years), in which I review the year in posts and note those of which I am particularly proud. For me it’s a way to remember what I’ve been on about, and catalog some of my sketches for further work (perhaps as a book, ahem).

So in chronological order, here are the posts I liked from these past 12 months, with some commentary as well:

January

Predictions 2010 I’ll be getting to this in a post later this week.

Search Getting Worse? What Did I Mean?! I wrote a series on this. This is a summary.

Google’s Tortured History With China In which the eventual unraveling of Google’s business in China began.

The Evolving Search Interface: Mobile Drives Search As App Or why mobile is a major threat to Google, and why Google responded with Android.

Why The Apple iPad Will Disappoint (The Obama Effect) I was wrong about the iPad being a dud, but not wrong about it disappointing me. It pretty much made everyone else happy, but I don’t like it mainly for the politics of it. And it did disappoint nearly everyone when it was announced, but then became a major hit. As to why I was unhappy: The Tuesday Signal: Birth of Another Orifice

Google Rolling Out Social Search: But Does It Leverage Facebook?  Glimmerings of what has become a full out data sharing war between the rivals.


February

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Thursday Signal: Are You Checked In? I realize, in this post, that checking in is a new field in the Database of Intentions.

Updated: Google to Air “Search Stories” Ad During Super Bowl… My big scoop of the year. Sigh, I guess Searchblog isn’t much of a news outlet, is it?!

The Thursday Signal: Is Google Losing Its Customer Focus? In which I determine it is, based on Buzz.

I Don’t Like The iPad Because… I guess I had to keep hammering on this. This is about how the iPad is loved by all traditional media because of its locked distribution model.

Friday Signal: The Web Gets Its Wisdom Teeth (We Hope) An extension of my MOLRS riff: Weds. Signal – “Local-Mobile-RealTime”: Re-imagining Social


March

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Why I Like Working With Marketers Because it makes me smarter.

Oh Looky! It’s Video of Bloody Jesus! (Nevermind the Facts) This year I seem to have become a cranky old journalism professor. This is one of a number rants on how bad some journalism has gotten. Also this one: Google v. China? No, It’s Bigger Than That

Toward a New Understanding of Publishing (Part 1) Cross posted from the FM blog. My first organized thoughts on brands as publishers.

My Location Is A Box of Cereal In which I expand on the idea of the check in as an important new Signal.

The 2010 Web2 Summit Theme: Points of Control Introducing the theme of this year’s event.

The Signal – Instrumenting Our Social Lives The idea of “instrumentation” is introduced and explored. I’ve used this framing all year long.

Video Chat on the Plane? Illegal? OK? Legal Gray Area? Turns out, it depends, but another example of pushing cultural and legal boundaries.

Database of Intentions Chart – Version 2, Updated for Commerce The definitive chart, at least for now. Based on: The Database of Intentions Is Far Larger Than I Thought

April

Brands As Publishers – Part 2 Second in the series started above.

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Foursquare – I Wish It Was Better For Me… And I still do.

Twitter To Roll Out “Promoted Tweets”: Initial Thoughts (Developing) My first take on Twitter’s long anticipated business model.

An Open Letter to Apple Regarding The Company’s Approach to Conversation with Its Peers and Its Community Everyone came to speak at Web 2, except Apple. This was my plea. It went unanswered.

Twitter’s “Public Interest Graph” My take on the value and signal Twitter is starting to create.

On Google’s Brand I point out that the brand is starting to mean too much and not enough.

The Gap Scenario I use this all the time now as a talking point around MOLRS.


May

The iAd: Steve Jobs Regifts The Mobile Marketing Experiencewillywkna.jpg I was not impressed.

Google’s New Mission? “To Organize the World’s information (Unless It Starts With “i”) …..” Google don’t play in Apple’s “Planet of the Apps.”

Fear Is A No No – Except at Night My thinking out loud about being a CEO and a leader. Got a lot of response to this.

The ROI of iAds – A Lot of Unanswered Questions And still unanswered, far as I can tell.

Five Years In One Place, An Appreciation It really is amazing that I love my work after five and one half years.

Is The iPad A Disappointment? Depends When You Sold Your AOL Stock. In which I attempt to explain my POV on the device, again.

June

Of Course Apple Is Going to Do Search. But not search as you know it today.

It’s Official – Apple Kicking Google Out of iWorld Wow, 91 comments, one of the largest responses this year…

Is Apple’s iWorld “The Web”? In which I tell a story about my son…

Will Google Compete With Facebook? Er…It Already Is, Folks. It’s not if, it’s not when, it’s how.

July

Is Yahoo Dead? I Don’t Think So. Who Else With This Scale Can Be Neutral?Screen shot 2010-07-14 at 1.06.43 PM.png My defense of Yahoo, which six months later, I stand by, though I can’t say the company is looking healthy.

On Facebook, Google, and Our Evolving Social Mores Online I go a lot deeper into the concept of Instrumentation here.

Search, Foursquare, and Checking Into States of Mind How a checkin is like search, if you redefine both a bit. Example: Checking into the state of mind of “wanting to buy a car.”

What Means This, To “Go Google”!? It means the brand isn’t about search alone.

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August

Second (Day) Thoughts on Google-Verizon Framework – Isn’t This All About Android? Or maybe, GoogleTV *and* Android. Or Maybe It’s Really About (Google) TV…

AT&T Weighs In: Trust Us, We Know What You Want More thoughts on the net neutrality debate.

Finding a Yogurt Shop A Mile Away: I’m Not Feeling Lucky. An old school rant on the state of search.

Is Google Objective? No. Well, maybe. Sort of. Depending on your point of view.

Web 2 Summit Points of Control: The Map I am very proud of this work.

On Retargeting: Fix The Conversation In which I propose a solution. That Was Fast: TellApart Implements A Searchblog Suggestion In which that solution is implemented.

September

More Thoughts On Demand: A Referendum of Sorts on Google and Social My longish take on Demand’s IPO and business.

Nielsen: Bing Overtakes Yahoo In Search Share Proving my prediction true…

Stop It. Google Won’t Buy Twitter. And why I thought that. One of the most tweeted posts of the year (wonder why).

October

Identity and The Independent Websocial_contract.large.jpg One of my longer pieces, and probably more important than most as well, in that it starts to frame a bigger idea – that of revealed identity as well as the concept of dependent and independent webs. FM, as you might expect, plans on being the most important media company in the independent web space, while working well with the leaders of the dependent web.

All Brands Are Politicians More of my thinking about what it means to be a brand in the context of today’s web.

November

Mark Zuckerberg at Web 2 – A Maturing CEO The most replayed stream of the Web 2 Summit. My writing suffers in October and November due to the work of Web 2 (well, honestly, it suffers all year long). But the output is almost worth it. However, I must say, I can’t both write a book, run FM, and run Web 2. Something will have to give.

Groupon Is Worth More Than $2.5 Billion My first post on Groupon, not my last.

Twitter’s Great Big Problem Is Its Massive Opportunity Twitter at another inflection point, a critical one. This one was third or so in retweets.


December

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In Google’s Opinion…. My continuing exploration of the concept of objectivity in search and algorithms.

Google’s “Opinion” Sparks Interesting Dialog On Tying of Services to Search And on it goes…

Is RSS Really Dead? No, apparently not, as this post got the most comments of the year.

Social Editors and Super Nodes – An Appreciation of RSS And it led to this post, which really crystalized my thinking about a key attribute of the social web.

Why Wouldn’t Google Mirror Wikileaks? Because no one wants to be the target of banks and major governments, I suppose.

Signal, Curation, Discovery The more time I spend in this industry, the more I enjoy writing about it.

Thinking Out Loud: What’s Driving Groupon? Second in retweets and still going.

That’s it – quite a lot of writing when you sum it all up. I was a bit bummed out during the year that I was not writing enough, and honestly, there are scores of posts I wish I had the time to create. While 50,000 or so words ain’t bad, it’s not what I’d like to do. So this coming year, I’ll be doing more, that much I can promise. And reviewing the work above does lead me to some promising conclusions about where “the next book” is going. And that makes me grateful for this site, and for your time. Thank you.