Category Archives: google

quick followup on google and yahoo

Posted by Todd Sawicki on May 9, 2007 View Comments

I’ve been getting emails from folks about both posts.  First, I don’t have anything against Google or Yahoo.  And in Google’s case I should point out - there’s nothing illegal about being a monopoly (a point MSFT might have better pursued).  What’s illegal is anti-competitive behavior.  And there’s no indication of that yet.  More my point is that the inevitable soap opera of market dominance as the past has shown seems to lead to the drama of an anti-trust showdown.  And who doesn’t like a good drama?

With regards to my rant about Yahoo – I am not picking on Yahoo to make the point about whether or not Google is better.  I am picking on Yahoo because I want and need them to succeed in the search game.  Competition is a good thing and breeds innovation.  I am pushing Yahoo to get better and point out some of the nutty business and product decisions they have made like still not allowing cpc bids below $.10 per KW.  Yahoo please stop ignoring the long tail of KW’s – it’s in everyone’s best interest. OK I’ll move on now.

emetrics report: google analytics new ui

Posted by Todd Sawicki on May 8, 2007 View Comments

I was able to visit emetrics today on behalf of loomia.  Thanks to my colleague and friend dave mcclure I was able to meet some cool folks.  But more importantly I got to see a demo of the new analytics UI.  If you’re an adwords user – it’s AWESOME.  Much better product.  To guys I meet from the GA team – Good Work!  And don’t worry guys I won’t even mention what McClure was talking about :)

barron’s is smoking crack

Posted by Todd Sawicki on May 8, 2007 View Comments

Barron’s writer Eric Savitz is smoking crack if he thinks a Google-Yahoo merger would ever get past the anti-trust regulators.  No way, no how.   That would represent 80-90% of the online ad market measure by dollars.  No way, no how.  Does he think the feds would let one company own 80-90% of the TV broadcast ad market?  No way, no how.

Let’s be honest the Google-DoubleClick is going to have some high hurdles with the feds let alone something on the scale of Yahoo as I’ve discussed here.

yahoo still doesn’t get it even with panama

Posted by Todd Sawicki on May 8, 2007 View Comments

I am fairly experienced with SEM having managed grown an SEM budget from $100 a day a few years ago to hundreds of thousands dollars a month across every conceivable search engine and contextual platform from Google to Kanoodle and everything in between.

Because of the size of their traffic – the two most important SEM platforms are Google and Yahoo.  And historically Google’s adwords system blew the doors off of Yahoo’s old, out-dated overture based system.  Google offered an easy to use but sophisticated platform that would allow me to get a new campaign up and running in minutes (and earning money for Google), while Yahoo’s out-dated overture platform was clunky, slow and required HUMAN approval which could literally take 2-3 weeks to get a new campaign or ad approved.  This created 2 huge issues – Yahoo was leaving huge amounts of money (likely hundreds and millions of dollars – how do you like them apples yahoo shareholders?) by not running ads while google was running the same ad because yahoo was too damn slow in approving ads and second optimization of ads was next to impossible on yahoo because it making changes was too painful in terms of time to make it worthwhile.  And in fairness – the new panama platform was built to addresss both issues which from my playing around seems to have solved.

BUT and there’s a HUGE but here… Yahoo still doesn’t get it.  Yahoo unfortunately still charges a minimum cpc of 10 cents.  Whereas up in Mountain View, Google charges as little as a 1 cent for a cpc.  I am sure some of you are saying – yahoo’s smart for charging a higher price because that means more money.  Wrong.  What it does is that it limits the words that someone can advertise on yahoo around – goodbye long tail of keyword’s (kw’s).  The more kw’s you use in a search campaign the lower value those outlying kw’s have to you.  And unless your making more money then the kw is costing you, then you won’t use it.  And so Yahoo artificially limits the amount of kw’s an advertiser will be willing to bid on if they had no minimum bid.  So until Yahoo truly embraces the lessons of Google’s advertising system, it is pretty easy to say Yahoo just doesn’t get it yet.

Does Google own the Internet?

Posted by Todd Sawicki on April 23, 2007 View Comments

My friend Andy pens that Google owns the Internet in the same way Microsoft owned the PC in the 90′s.  I don’t know if I agree that Google owns the Internet but it does currently own monetizing the Internet or at least until someone figures out how to monetize social networking and media traffic.  For anyone who has touched myspace traffic via ads or widgets will tell you – Myspace owns consumer traffic. 

how to become a monopolist: the google story

Posted by Todd Sawicki on April 15, 2007 View Comments

Hmmm advertisers are growing wary of Google’s market position with the purchase of DoubleClick according to AdAge.  Market concentration is a serious problem for competitors and customers and will be an important issue for the online ecosystem for at least the next 10 years.  Whether Google plays nice or not will be seen.

The title of the post sounds like a catchy title for the google story someday after they get sued for their monopoly in the online advertising market – vertical, tied integration, unfair competition due to bundled services that undercut competitors (ie. google analytics), and marginal pricing… I can practically read the complaint now ;-)   Seriously who knows whether it will come to pass, but as I wrote about earlier – all the previous tech titans have gotten sued for antitrust violations (ibm, intel, and microsoft) so it is not that far-fetched.

UPDATE:  As if on cue in response to my post here (trust me I know it wasn’t really) – Rafat over at Paidcontent.org posts a good summary of other coverage where Microsoft, AT&T and Time Warner all raise the anti-trust/anti-competitive flag.  I guess I wasn’t too crazy for bringing up the idea a few months ago.

UPDATE2: I just created a bet over at Blubet (a new social betting for fun startup – thanks Sr. McClure for introducing) so people can put their Blubet points where there mouths are.

Online Business Trend: The Ad-Supported Computing Cloud

Posted by Todd Sawicki on April 13, 2007 View Comments

I am of course biased by my experience – which has been at the intersection of consumer oriented services around data, ad-supported content and digital media.  One of the areas that is interesting to see emerge is the Computer in the Sky or as some refer to it as the Computing Cloud.  This has long been an area of interest to me going back to my early days at Loudeye.  One of the visions we had there was to build a digital music jukebox in the sky.  We started tinkering with the idea in the winter of 1998 (I still have a copy of the original pitch presentation I put together for Martin and the board).  The idea was to build something along the lines of Amazon.com’s Web Services but for music – allow any business to plug into the Loudeye Media Platform and create their online music service.  Unfortunately the inability to get blanket distribution rights from the labels combined with infrastructure costs it just didn’t pan out.  For instance back in the day a 1TB online storage solution would have cost a couple of million dollars.  And what’s amazing is that today you can buy a 1TB 3.5 disk drive for $500.  Now today, with the rise of Amazon’s very cool S3 and Ec2 offerings you are finally beginning to see a true Computer in the Sky.  It’s easy now to imagine a jukebox in the sky or a library in the sky, you think of it you name it. 

Now the infrastructure side of the cloud is out there, others are rushing in to add services and utility.  The whole webware movement is a natural extension of the movement – add value to the utility infrastructure.  We are in the early stages with online versions of office apps from Google and Zoho for instance to vertical apps like CRM from Salesforce.com or accounting from Intuit with online versions of Quicken, TurboTax and Quickbooks easily available.

From a consumer perspective, the next movement will be free-ad suppoted computing in the sky.  There’s still work to be done as I have learned from experience monetizing content can be tricky.  Personal content often doesn’t work well with targeting engines like contextual engines (Google AdSense for instance).  And at the same time, users tolerance for ads in an application environment can be tricky.  Fortunately there are startups looking to solve this project.  And the day they do and a computing cloud service offers compelling utility with that ad-model built in is a day when I think this market truly explodes.  Imagine the ability for users to create personalized versions of services.  Point and click your way through a function and feature list to offer a service for you and your friends to enjoy.  OK I am getting a little dreamy but I think you get the point.

DIY/NIH: The Economics of Abundance and Startups

Posted by Todd Sawicki on April 10, 2007 View Comments

Fred Vogelstein’s interview with Eric Schmidt presents an interesting story about classic DIY/NIH impulses that comes from engineers and developers - in this case Larry and Sergei desire to build a financial system themselves instead of buying one from Oracle.  At every startup I have worked at this desire comes up.  Developers are builders and they like to build things and more importantly they like to know how things work which they often feel comes from building things themselves.  And as a business guy, you will often find yourself wanting to hit your head against the wall as your dev teams want to build things that should just be bought.  For instance at a fomer company, the devs tried to build their own CRM system.  Let’s just say that Salesforce.com is currently the CRM system being used there.  Lesson learned.

At some level hearing the Google story is encouraging to hear that what I have experienced with developers is not unique.  But it’s interesting how a lot of the innovation in the web 2.0 ecosystem absolutely flies in the face of the developers’ natural instinct to build it themselves.  Numerous VCs and entreprenuers have talked about how its easier and cheaper then ever to do an internet-based startup because you can outsource so many elements of the business – accounting software, CRM, hosting, email, storage and even CPU hp thanks to Amazon’s Web Services.  And in startups where resources are scarce (and money even scarcer), you have to leverage whatever cheap, outsourced alternatives you can so you and your team can focus on building the nugget of IP and value that makes all those back-end services unqiue to your customers.

Today only in enterprises where abundance is king – and Google certainly qualifies much like Microsoft in its hey day – can you even think (however irrationally it likely will be) about building or doing things yourself.  It will be interesting to see how the excess of profits that Google enjoys plays out in terms of building enterprise value or whether Google’s cultural bias to build things themselves ends of wasting billions of dollars of enterprise value.

Personally as I embark down my own startup paths, I can certainly tell you that I am big fine of the innovation in outsourcing and plan on outsourcing as much as humanly possible.

It pays to break the rules

Posted by Todd Sawicki on March 26, 2007 View Comments

Mark Cuban’s question in a post below asks us to imagine if my old company – encoding.com aka Loudeye (which encoded lots of a-list music and video) decided to throw all the content it had online.  That would have been one hell of a site from a user’s perspective – movies, music videos, cd’s (in fact at one point every single music CD sold online), and more.  The only problem is that it would have been illegal. 

That trip down memory lane started by Mark’s comment, did get me thinking.  First there was Napster.  Then MyMP3.com and now arguably YouTube.  All skirting the rules or maybe downright illegal.  But this isn’t meant to be another rant on the legalities of YouTube as I will leave that to Mark, et al (and for those that don’t know Mark knows what he’s taking about with regards to the DMCA since he was active in the trade group – DIMA – that negotiated the law). 

My point is how those legal risk takers were rewarded.  Napster got a lot of funding from Hummer Winblad and a buyout from BMG (what were they thinking).  MP3.com was bought by Vivendi Universal making its founder a multi-millionaire.  Kazaa made a fortune for its developers and future owners Sharman Networks.  And we all know about YouTube’s $1.6 billion dollar buy out from Google.  That’s a lot of money for potentially illegal business activity.  Who says you can’t profit from illegal activity ;-)

And what happened to the companies that tried to follow the rules?  Dave Pakman’s mylocker.com with a legal version of MyMp3.com hit a wall (Dave did go on to run the now successful eMusic site).  Loudeye struggled to get commercial music licenses for two years ultimately missing the boat on consumer music apps when iTunes came onto the scene.  Not to mention the gutter of history filled with online video companies who struggled to license content like AtomFilms (think how big that would have been with a nod and wink to copyright).

I am not arguing whether the current laws and rules are fair – I often think they are a major pain in the ass.  Just because you don’t like them does it mean you can ignore them as some VCs seem to want to imply - just ask Cablevision Systems (seriously given the the MyMp3.com ruling I don’t know how they thought they were going to prevail without direct licenses).  But if you were an enterprising person – breaking the rules might be just the thing to make a lot of money. 

being early = wrong v2, the spot runner story

Posted by Todd Sawicki on March 21, 2007 View Comments

Today Henry Blodgett argues Google should buy Spot Runner essentially arguing Spot Runner is enabling targeted TV advertising for the long tail of local advertisers.  Spot Runner’s not the only company dreaming the dream of enabling the long tail video advertising (both online or offline).  And based on a conversation I had a little awhile ago with David Stern, VC at Clearstone Ventures who has a passion for online advertising, VC’s are dreaming the dream as well.   Seems to make great sense as Henry points out – imagine if you can make TV advertising easy – then everyone would do it.  WRONG – at least not this in this generation.

David was looking at the space and wanted my take on it as venture play.  Thinking about it for a second (and I have experience in cable tv and in online video – going back to the earliest, earliest days of that market thanks to my experience co-founding SimplyTV.net) – my answer was video marketing seriously lacks an addressable market.  Video advertising beyond the core (ie. local car dealers, mortgage companies, political campaigns and humongous CPG companies) is a long, long way from crossing the chasm to becoming a mass market phenomenom.

The problem with video is that so few marketers have any experience using it.  They don’t know how it works, how to produce it, how to judge it, how to report on it, or how to buy it.  Seriously how many companies have ever used video advertising in this country? 10,000 maybe?  How many use it regularly? Less then 1,000 more likely.  Therefore no matter how easy someone like Spot Runner makes it – it isn’t anything any substantial number of marketers have any comfort with.  And that’s hugely important – when 250,000 marketers are familiar with search marketing and are comfortable using it and millions more with yellow pages advertising.  The last thing most people have the time and energy is to learn something new.  Seriously how many people over the age of 25 have ever even edited a home movie?

Now that last comment raises a key point because the under-25 set is the YouTube generation.  They are being raised in era of ever cheaper camcorders and camera phones with video capabilities.  They are being raised learning and thus knowing how to express themselves using video.  So in 10 years when they start their marketing careers they will be looking to use video because they know how to communicate and judge video.  Then you’ll be looking at a market that might truly be interesting for spot runner, et al.  But tjhat’s a decade from now and as I wrote the other day – being early is good as being wrong.