Marissa Mayer On Recent Google Innovations and Newspapers

In the most-awaited session of the afternoon of Day 1 at LeWeb, Michael Arrington (from TechCrunch) sat down with Marissa Mayer, Vice President, Search Products and User Experience at Google to discuss a series of hot topics like recent Google innovations, mobile and the newspaper industry.

Marissa Mayer Google Michael Arrington Techcrunch LeWeb Paris December 2009 - 1

On recent innovations:

  • Mayer says Google is focused on future of search and they expect different modality of search, not just through keywords. That’s why they launched Google Goggles this week which is basically image recognition (you take a picture and Google tells you what it is). See this example. They also expanded voice search to Japanese and added the “What’s nearby” mobile functionality. Mayer thinks that people will eventually talk to their phone or take a picture to make a search. They also added real-time results (from Twitter, blogs, Facebook, MySpace, etc.) to regular search results, which drastically increases the relevancy of Google search results.
  • On Google Chrome, she mentioned the release of Chrome Extensions which allows anyone to add functionalities via plugins in the Chrome browser (like Firefox). She said there are “tens of millions of Chrome users”.
  • On Google Wave, Arrington stated “there’s something there” but wondered if we needed more “training”. I think most people are unsure of the value of Wave today and that’s why the Techcrunch founder asked the question.

On mobile searches:

  • Mayer says they’ve grown tremendously on smart phones. Asked by Arrington if their total share of mobile searches over total searches was in the 1 to 5% range, she answered “slightly higher than that”.

Marissa Mayer Google Michael Arrington Techcrunch LeWeb Paris December 2009 - 2

On newspapers:

  • Arrington started by saying we all understand the dire situation of print media and mentioned Eric Schmidt recent vision piece in the Wall Street Journal. He then asked Mayer: “What’s your vision?”. The VP from Google answered with a question: “how do you get users more engaged with news online?” She continued by stating that if we could build a news site from scratch today, it would probably look very different than what we have today. She then mentioned The Living Stories experiment they’re doing with the New York Times and the Washington Post. “What if the story was alive? Not just the print version posted online.” She added that the Web “puts pressure on the atomic unit of consumption. The article is the atomic unit.” She then suggested we could aggregate all news story on the same topic on one page, like Wikipedia, to help with discovery in Google.
  • She closed that topic by suggesting “personalized stream of news”, probably on your mobile phone, would be interesting. The stream would be filtered according to your social circle, location, the news brands you like, the writers you like, and the important news you should know about (she called them “veggies”).
  • Asked if newspapers will move fast enough, she thought so and mentioned the New York Times and Washington Post are very progressive partners and very interested on how they can reinvent themselves.
  • On Murdoch, Mayer mentioned the partnership with MySpace. Asked if she thought News Corp would pull their content from Google, she answered “I hope not” as it would impact comprehensiveness of their results set. She added “we have to respect the content owners. We would respect his will.”
  • Finally, Arrington asked if Google would consider paying for content, Marissa Mayer proposed that they already have programs for content monetization through Google Adsense and their display ads network.

See more on Techcrunch.

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Om Malik Says “Yahoo! Should Buy Hulu”. It Won’t Happen and Here’s Why.

Om Malik surprised me today by suggesting Yahoo! should buy Hulu, the joint venture video portal of NBC Universal and News Corp.  The company was founded in 2007 to create a destination site to present content from TV networks and was a response to the meteoric rise of YouTube.

Malik comes to that conclusion while thinking about the need for a solid number 2 exec at Yahoo! now that they’ve named Carol Bartz as their new CEO. He thinks Jason Kilar, Hulu’s young CEO, is a natural for that role and he suggests Yahoo! buys them.

He says: “With his service growing by leaps and bounds, and advertisers lining up to get on board, Kilar’s only problem is that he doesn’t have enough traffic –- like, say, YouTube. That will change over a period of time; and as we all know, time is an elastic concept. Perhaps this is where Yahoo can help. Or rather, where the two can help each other. Clearly search and search advertising isn’t quite working out for Yahoo; what Yahoo knows best is media and content. Which is why buying Hulu would be a strategically relevant acquisition for the company — it would play to Yahoo’s media strengths.”

He adds to explain why NBC and News Corp. would sell: “You’re probably thinking, why would Fox and GE sell their pet project to Yahoo? Well, why not? After all, they took a $100 million investment from Providence Equity Partners, which means they have an interest in making some sort of a return on this company.”

Wrong. Wrong. Wrong. Hulu is one of the core elements of NBCu and News Corp online video strategy.  They were ridiculed when it was first announced (Techcrunch called it Clown Co., they’ve changed their minds since then) but they proved everybody wrong.  Most people thought a joint venture between traditional media companies would fail, that the user experience would be bad, that no one would use it. According to this article, in September 2008, they streamed 142 million videos, a 42% month over month increase. It’s growing fast and on the verge of becoming a major player online. Selling Hulu to Yahoo! would be like AT&T selling YellowPages.com to Google. Won’t happen, nope. Don’t even think about it. As for return on investment, expect an IPO in a couple of years, not a sale.

And Hulu!  We want access in Canada!

Om Malik Says "Yahoo! Should Buy Hulu". It Won't Happen and Here's Why.

Om Malik surprised me today by suggesting [praized subtype=”small” pid=”4ba3024afad224aed466c0367141ce59″ type=”badge” dynamic=”true”] should buy [praized subtype=”small” pid=”b4e172b2799ee9f440309b3b6454633c” type=”badge” dynamic=”true”], the joint venture video portal of NBC Universal and News Corp.  The company was founded in 2007 to create a destination site to present content from TV networks and was a response to the meteoric rise of YouTube.

Malik comes to that conclusion while thinking about the need for a solid number 2 exec at Yahoo! now that they’ve named Carol Bartz as their new CEO. He thinks Jason Kilar, Hulu’s young CEO, is a natural for that role and he suggests Yahoo! buys them.

He says: “With his service growing by leaps and bounds, and advertisers lining up to get on board, Kilar’s only problem is that he doesn’t have enough traffic –- like, say, YouTube. That will change over a period of time; and as we all know, time is an elastic concept. Perhaps this is where Yahoo can help. Or rather, where the two can help each other. Clearly search and search advertising isn’t quite working out for Yahoo; what Yahoo knows best is media and content. Which is why buying Hulu would be a strategically relevant acquisition for the company — it would play to Yahoo’s media strengths.”

He adds to explain why NBC and News Corp. would sell: “You’re probably thinking, why would Fox and GE sell their pet project to Yahoo? Well, why not? After all, they took a $100 million investment from Providence Equity Partners, which means they have an interest in making some sort of a return on this company.”

Wrong. Wrong. Wrong. Hulu is one of the core elements of NBCu and News Corp online video strategy.  They were ridiculed when it was first announced (Techcrunch called it Clown Co., they’ve changed their minds since then) but they proved everybody wrong.  Most people thought a joint venture between traditional media companies would fail, that the user experience would be bad, that no one would use it. According to this article, in September 2008, they streamed 142 million videos, a 42% month over month increase. It’s growing fast and on the verge of becoming a major player online. Selling Hulu to Yahoo! would be like AT&T selling YellowPages.com to Google. Won’t happen, nope. Don’t even think about it. As for return on investment, expect an IPO in a couple of years, not a sale.

And Hulu!  We want access in Canada!

Om Malik Says "Yahoo! Should Buy Hulu". It Won't Happen and Here's Why.

Om Malik surprised me today by suggesting [praized subtype=”small” pid=”4ba3024afad224aed466c0367141ce59″ type=”badge” dynamic=”true”] should buy [praized subtype=”small” pid=”b4e172b2799ee9f440309b3b6454633c” type=”badge” dynamic=”true”], the joint venture video portal of NBC Universal and News Corp.  The company was founded in 2007 to create a destination site to present content from TV networks and was a response to the meteoric rise of YouTube.

Malik comes to that conclusion while thinking about the need for a solid number 2 exec at Yahoo! now that they’ve named Carol Bartz as their new CEO. He thinks Jason Kilar, Hulu’s young CEO, is a natural for that role and he suggests Yahoo! buys them.

He says: “With his service growing by leaps and bounds, and advertisers lining up to get on board, Kilar’s only problem is that he doesn’t have enough traffic –- like, say, YouTube. That will change over a period of time; and as we all know, time is an elastic concept. Perhaps this is where Yahoo can help. Or rather, where the two can help each other. Clearly search and search advertising isn’t quite working out for Yahoo; what Yahoo knows best is media and content. Which is why buying Hulu would be a strategically relevant acquisition for the company — it would play to Yahoo’s media strengths.”

He adds to explain why NBC and News Corp. would sell: “You’re probably thinking, why would Fox and GE sell their pet project to Yahoo? Well, why not? After all, they took a $100 million investment from Providence Equity Partners, which means they have an interest in making some sort of a return on this company.”

Wrong. Wrong. Wrong. Hulu is one of the core elements of NBCu and News Corp online video strategy.  They were ridiculed when it was first announced (Techcrunch called it Clown Co., they’ve changed their minds since then) but they proved everybody wrong.  Most people thought a joint venture between traditional media companies would fail, that the user experience would be bad, that no one would use it. According to this article, in September 2008, they streamed 142 million videos, a 42% month over month increase. It’s growing fast and on the verge of becoming a major player online. Selling Hulu to Yahoo! would be like AT&T selling YellowPages.com to Google. Won’t happen, nope. Don’t even think about it. As for return on investment, expect an IPO in a couple of years, not a sale.

And Hulu!  We want access in Canada!

On Atomizing Your Business Model: The Newspaper Industry

Continuing our series on the atomization of content and business models, today I look at the newspaper industry.

First, from the user point of view: online (vs. the print version), it’s much more difficult to find the glue that will make your news container (your URL) stick together. if you have a strong brand (the New York Times, for example), people will navigate directly to your site but readers can now access your content via RSS readers, blog posts and news aggregators like Google News. These have been flourishing, reorganizing newspapers’ articles (the new content atoms), into flexible reading formats. For newspapers, it’s a catch-22. You want to be indexed by news aggregators to drive traffic back to your site but you wonder if you’re losing brand equity at the same time. Efforts at trying to get readers to register to newspapers’ sites (to generate potentially valuable socio-demographics information) have been a major failure. Clearly, the only strategy now is building a strong brand online while allowing readers to access your atomized content via a variety of vehicles but that creates problems from a monetization point of view.

Traditionally, the newspaper business model has been found in these three revenue categories: reader subscriptions, traditional display advertising and classifieds. Except for a few exceptions (the Wall Street Journal comes to mind), experiments in paid online user subscriptions have been failures as digital content is much more difficult to sell as an aggregate than print content. Classified revenues are being nuked by free sites like Craigslist or Kijiji, or aggregators like Oodle. Newspapers have been also forced to offer free classifieds, managing to generate some priority placement /enhanced content revenues but not to the previous print level. Online display advertising is working but it does not monetize as well as print advertising.

To better monetize their destination site, newspapers have been looking at various new solutions. One is in-line text ads (double-underlined sponsored keyword ads appearing directly in the article text) delivered by companies like Vibrant Media but, as I mentioned yesterday, the blurring of the line between editorial and advertising content has created ethical issues within news organizations. Already in 2006, in an article called “Is It News…or Is It an Ad?”, the Wall Street Journal exposed the various issues around the product:

“This type of online advertising within the text of an article, known as in-text advertising, has been around for a while. But it used to be relegated to niche sites like the videogamers’ haven IGN.com and ScienceDaily.com. Now it is appearing on some mainstream journalistic Web sites, like those of News Corp.’s Fox News, Cox Enterprises Inc.’s Atlanta Journal-Constitution and Hearst Corp.’s Popular Mechanics magazine. That marks a departure from a long-observed tradition in the print medium of keeping editorial content separate from advertising. “Journalism ethics counselors decry the trend. “It’s ethically problematic at the least and potentially quite corrosive of journalistic quality and credibility,” says Bob Steele, the senior ethics faculty member at the Poynter Institute, a journalism school in St. Petersburg, Fla.”

More recently, Tim McGuire from the Walter Cronkite School of Journalism in Arizona wrote about its use in the Arizona Central web site:

Michael Coleman, Vice-President of Digital Media for AzCentral, told me late Friday that the site has been using Vibrant Media for “two or three weeks.” Coleman described the relationship as a test and said this is not a “Gannett roll-out” of the concept even though some Gannet papers are using the system. “We’ve got a pretty non-committal contract with them, Coleman said. “The publisher made the call, and we decided to try it and see what happened.” Coleman said the experimental aspect of the deal explains why nobody has announced this deal.

Business Week wrote about the phenomenon in December:

Many journalists believe that selling the words in a story blurs the line between editorial and ad content. Some worry it creates an incentive to insert ad-linked words or order up certain types of stories. Forbes’ online arm caused a ruckus in 2004 when it rolled out in-text ads. After an outcry among the editorial staff and negative media coverage, Forbes ended the practice. (…)

Publishers are paid by Vibrant and other marketing companies based on how many times readers scroll over a word. Advertisers only pay Vibrant for how many times a reader actually clicks on an ad. In-text ads draw a higher response than traditional Web ads: About 0.2% of Web users click on posterlike ads known as banners; Vibrant CEO Douglas Stevenson says 3% to 10% scroll over and click on in-text ads, depending on the category.

I think the use of in-line text ads might be problematic thus far because newspapers have been using the technology to better monetize their destination site. I would suggest that the better use of this new ad vehicle would be to monetize a smaller atom of content, i.e. the news article, decentralized from the destination site. Embedding in-line text ads within RSS feeds or other distribution mechanisms might be a small price to pay to allow readers to access news article outside of the newspaper’s site. Another option would be to have RSS ads, like the Feedburner Ad Network.

I think the general takeaway here is that newspapers shouldn’t look at the same business models to monetize centralized and atomized content.

Update: The Kelsey Group discussesNewspaper Next 2.0, a “progress report” by the American Press Institute on the evolution of newspaper companies beyond the print edition.” I took a quick glance at it (it’s a 110-page document) but it does not seem to address many of the business model issues that newspapers are facing. As my friend Peter K. says in the post, “The report has a better fix on consumer-oriented solutions than business solutions. But that’s not surprising for a newspaper industry (i.e. editorial-driven) product. If the Yellow Pages Association commissioned similar research, it would probably be the other way around.”

NBC and News Corp. to Partner with “Everyone But Google” to Launch YouTube Killer

(via TechCrunch)

The rumors of a joint venture to counter the perceived Google-YouTube threat, dubbed “Clown Co.” by Google executives, are now confirmed, although the name of the new company is not yet available. In a press release, Peter Chernin (COO News Corp.) and Jeff Zucker (CEO NBC Universal) are announcing “launch the largest Internet video distribution network ever assembled with the most sought-after content from television and film.” Content from at least a dozen TV networks and two major film studios is promised. Initial distribution partners include AOL, MSN, MySpace and Yahoo.

Chernin says they will have access to “the entire U.S. audience” at launch. The service is promised for this summer, with “thousands of hours” of full length televisions shows and movies, as well as shorter clips. Users will have unlimited and free access to content on the site. At launch, full episodes and clips from current hit shows, including Heroes, 24, House, My Name Is Earl, Saturday Night Live, Friday Night Lights, The Riches, 30 Rock, The Simpsons, The Tonight Show, Prison Break, Are You Smarter than a 5th Grader and Top Chef, plus hits from the studios’ vast television libraries, will be available free, on an ad-supported basis, within a rich consumer experience featuring personalized video playlists, mashups, online communities and video search. Plus, the extensive programming lineup will include fan favorite films like Borat, Little Miss Sunshine, Devil Wears Prada, The Bourne Identity and Bourne Supremacy with bonus materials and movie trailers. Post-launch, plans will be considered for acquiring additional content as well as producing and licensing original programming for the new site’s audience.

What it means: Wow! Google seems to be heading to the same penalty box Microsoft sat in for most of the later portion of 1990’s. Remember when Netscape created the “Everyone But Microsoft” league? It sure sounds like TV & movie creators are heading in the same direction by saying “Everyone But Google”. If the thing flies, expect other TV networks and movie companies to join the group. You can also expect a renewed onslaught of copyright lawsuits against YouTube. As TechCrunch asks, I wonder if there will be a delay between the broadcast and the Web posting of a TV show. I also hope they don’t block viewers from other countries via IP detection!

MySpace Wants to Partner with Other Media Firms to Launch ‘YouTube Killer’

From Variety.com via NewTeeVee.com

News Corp. is forging ahead on talks with a number of congloms to create a video platform that could compete with YouTube. “We’re in very active negotiations with all of the media companies to create the most robust video offering from professional content on the Web,” Fox Interactive Media topper Peter Levinsohn told investors at the Bear Stearns confab in Palm Beach, Fla. “Those conversations are ongoing, but they’re going very well,” he added. (…)

And then, perhaps hinting at where such a convocation would happen, he added, “No doubt MySpace will be a huge beneficiary of that.” News Corp. would reportedly like to see much of the content from other congloms live on its social-networking subsid. But comments glossed over a big sticking point: Other congloms have been resistant to making video available to MySpace, worrying that it would drive traffic and revenue to a competitor. Congloms are by no means unanimous on the subject; NBC has reportedly been more willing, while CBS has been more reluctant.(…)

Viacom recently decided to go its own way on video-sharing after talks with Google broke down, signing a content deal with a YouTube competitor, the Europe-based startup Joost. MySpace has been a major platform for News Corp.’s video, offering a hefty number of clips and sneak peeks of Fox content. Levinsohn did say that a major obstacle to pacting with other congloms is ensuring that those in charge of digital operations have the ear of the conglom chiefs. Digital divisions have gained clout in recent months but still may not have as much sway in the exec suite as they may need.

What it means: reading between the lines, this article highlights a couple of interesting points. First, the struggle of traditional media firms to redefine their competitive space with the arrival of Google: “Other congloms have been resistant to making video available to MySpace, worrying that it would drive traffic and revenue to a competitor”. Who’s the biggest long term competitive threat to CBS? Is it News Corp or is it Google-Yahoo-Microsoft (GYM)? And why not partner with both groups? I personally think you want to build up your own assets while partnering within your industry but also with GYM. We’ve seen the same kind of ambiguity in the newspaper world with Tom Mohr’s “Winning Online” manifesto “proposing that the US newspaper industry should merge into a single industry-wide network, at least for its digital assets. The article also discuss the kind of internal politics interactive teams are facing within traditional media companies: “Levinsohn did say that a major obstacle to pacting with other congloms is ensuring that those in charge of digital operations have the ear of the conglom chiefs.”. This internal in-fighting is, in my opinion, completely useless. The competitors are outside the walls of the company, not inside. Trust your interactive teams, they understand this new world order.