February 4, 2008
Most of my business readings this weekend have been various analysis of the potential Yahoo/Microsoft deal. Unfortunately, I haven’t been impressed by the level of the debate as many of the comments were all about “Microsoft is evil” and its corollary “Google is not”. I was hoping for more level-headed reflections but I think the involvement of Microsoft in the story created a highly-emotional environment in the tech blogosphere.
One of them stood out for me. Tim O’Reilly looked at the big picture and tries to extract some industry meaning, showing once again his crystal ball is one of the most polished in the industry. Talking about industry consolidation in general and Yahoo in particular, he offered:
The web companies that have a chance of surviving as independent entities are those that truly understand and exploit the rules of the new platform: harnessing collective intelligence to build rich troves of data that literally get better the more people use the application, running ahead of any possible competitor simply because of the network effects that pile on to keep them improving faster than any newcomer. Some of Yahoo!s properties (e.g. Flickr) have that characteristic, but Yahoo!’s business as a whole did not. It was ultimately a halfway house on the way to Web 2.0. It’s original business was based on a literal aggregation of user generated content, but it quickly became a more traditional content and services portal. Later companies like Google leapfrogged it by building services that tapped more directly into the native network effects of the Web.
The other important characteristic of the winners, of course, is that they tap into a data stream that really matters. Owning network effects around consumer photos, for instance, is much less powerful than owning network effects around paid search. So one of the key questions we have to ask ourselves going forward is this: what are the major data subsystems of the future Internet Operating System. Location, identity (and social graph), search (and not just web search but also product search, in which Amazon has a very strong position) come to mind. In a lot of ways, finding the data associated with the old vectors who, what, when, where, and how is a good place to start.
What it means: O’Reilly posits that local search (Location + Search) is one of the key elements of the future Internet Operating System. I completely agree with him. I would add that no one has locked the market yet. No one in that field is deeply embedded yet in the Web O/S. So, this still represents a major market opportunity. And the big question remains: who will own “where”?
March 21, 2007
(via the ClickzNews Blog)
I’m down here visiting the Kelsey Group’s “Drilling Down on Local ’07” event, and a few minutes ago Safa Rashtchy, sr. research analyst, Internet media and marketing, managing director for Piper Jaffray, finished up his keynote address regarding local search. (…)
(…) as this is a local show, he expanded on user interest trends to say that “Local search is the second most popular activity other than e-mail. You will have more and more focus on local search, whether it’s information or product searches that are happening. The adoption of local search by both local and search advertisers will see an increase.”
He also predicted a shift of users away from portals to search platforms, and said the inflection point for local search will happen when businesses finally get more of their inventory online. The first company to do so, he added, will “win” the business race.
“The navigation method from portals is changing from portals to search,” he said. “People are saying ‘we know what we want, help us to find where it is and don’t tell us what we want to buy.’” Rashtchy continued, “The trigger point [for local search] is likely to be when you have a large number of major merchants that have their inventory easily available online. I thought we might see something by now, but nothing significant has happened yet, but once we see a good part of inventory easily accessible online, we will see a shift.”
Finally, he predicted that mapping and satellite imagery will be coming an integral part of search. “Geographical representation of not just products, but also businesses, is more appealing — the visual aspect of it — and it will play well.” (…)
Safa recently announced he was leaving Piper Jaffray.
What it means: like Safa, I’ve recently become a strong proponent for graphical navigation in local search (through maps, images, etc.). I just love the Flickr geo-tagged image navigation interface (BTW, that’s a great source of local content). Safa also thinks that product inventory is also a killer app but I think it’s going to take a long time before we get to that place. I still think CrowdShopping (or Tuangou) can happen more quickly.
January 8, 2007
“A debate in the blogosphere and trade press over the relevance of the Web page-view metric picked up steam in the latter half of 2006. While many argued the metric has never been more than a rough proxy of impressions, it is the universal currency of online media buyers and sellers, and it’s making publishers increasingly, if secretly, anxious. “
“The underlying issue is the adoption of new Web technologies, like Ajax and Flash, which increasingly eliminate the need to reload a Web page. (Think of more dynamic services like Google Maps, Yahoo Mail, Flickr and YouTube videos embedded in blogs.) These technologies, while enhancing usability and increasing functionality, usually result in fewer page views for the publisher, and, ahem, fewer CPMs to sell. This more complicated Web means clickstream, consumption and interaction is now far less represented by the page view. “
“Not surprisingly, the death of the page view has been predicted and touted recently by some of the Web’s more forward-looking champions of such aforementioned technologies–people like Fred Wilson, Steve Rubel, Steve Gillmor, Niall Kennedy and Fredric Paul. And with MySpace overtaking Yahoo in the page-view chest-beating race, Peter Daboll, Yahoo’s chief of insights (…) also came out last month to boldly argue for a page-view death sentence.” (…)
What it means: I stopped being a fan of page views in 2001 when I discovered that unique visits and unique visitors were a much better value indicator for a local search site. When the search engine economy picked up steam in 2004, I switched my interest to searches. I’m now a proponent of converted searches (i.e. searches that convert into desired action) as a better ROI measure. As I like to say: “Not all searches are born equal”. But there’s no good third-party reporting tool that will allow you to measure this.