Why Twitter matters … a lot. Clue = Soylent Green.


Twitter is moving into the mainstream faster than any major internet application in history, and is redefining  online behavior as we continue to  move away from “internet as information” and into the era of “internet as people”.

Obviously both information and socializing will play a huge role in online behavior for the duration, but like the ubiquitous and mysterious food source in the old Charleton Heston Movie, Soylent Green

solyentgreen

Twitter is especially  important because ….  “Twitter is People”.

Some Twitter enthusiasts wrongly suggest that Twitter is important because it is breaking a few bits and bytes of news in real time (e.g. Hudson Plane Crash, CA Plane Crash) or providing a platform for discussion of pressing social issues (e.g. Gaza War).    Meanwhile Twitter critics very foolishly point to the obvious about Twitter’s superficiality as if this was a defect.

Twitter is certainly largely superficial in terms of how people chit chat on the service, but this is the reason for it’s spectacular success.  Humans by nature – ie by millions of years of evolution – are not designed well for thoughtful, reasoned discourse.   Instead, for much of evolutionary history we were very UNintelligently designed by trial and error and random mutations to survive in sometimes hostile environments.     This makes us a short term, superficial socializing thinker more than a long term planner.    Sure, we sometimes  do that long term stuff but if there are any lessons we can derive from history  it is how poorly humanity has optimized our long term well being.    One need look no further than the ongoing global financial crisis, global terror threats, tribal disputes across Africa, or global religious intolerance to see how poorly we cope with situations that would probably respond well with even a modest level of long term, optimal  planning rather than the short term knee jerk nonsense that often stains our  local and international finance, politics, and social relationships.

Twitter’s simplicity and superficiality are exactly why it will continue to thrive, diving into mainstream use faster than you can Tweet  Ellen Degeneres, who yesterday challenged her viewers to become “followers” of her Twitter account.    Although her goal of a million followers was not realistic, Ellen rose from zero to over 110,000 followers in a single day – perhaps a Twitter record and certainly a demonstration of a significant convergence of Television and internet audiences.

As internet activity stabilizes I think we’ll see people relying more and more on Twitter as their socializing platform of choice.    There’s certainly room for many social networking sites,  but I think Facebook needs to worry that Twitter may diminish the time people spend at Facebook in favor of the simpler, more intuitive interactions at Twitter.     Twitter has done for social networking what Google did for Search – they created a super clean interface and made it extremely easy to participate, building a large and happy user base in a very short time.     Unlike Google, however, Twitter will continue to face challenges monetizing their success, for as we’ve learned from Facebook’s experiences with ads and advertising fiascos it is not nearly as easy to make money in social networking as in information searching.    I predict it never will be as easy and Twitter is likely to face some interesting challenges as they try to bridge the gap between user enthusiasm for Twitter and aversion to advertising.      However Twitter will be a spectacular success with even a fraction of Google’s adverising revenue, so I see them thriving for some time.

TechCrunch’s Erick has this

New Google Ads: We’ll make your life even better by profiling and pitching you.


One is always torn between 1) complementing Google for their cleverness, generally good internet stewardship and 2) pointing out how they always manage to find Google gold in the “internet virtue” equation.   Now, I’m all for internet advertising and as an information publisher elsewhere I’m also a beneficiary of this change since I run Google Adsense advertising at several sites.  However I’d say the explanations of how what’s good for Google is good for the gander (FYI YOU are the gander) can sometimes be a little nauseating to read as in the latest post by Anne W. at the Google Blog:   [cue symphony here]

By making ads more relevant, and improving the connection between advertisers and our users, we can create more value for everyone. Users get more useful ads, and these more relevant ads generate higher returns for advertisers and publishers. Advertising is the lifeblood of the digital economy: it helps support the content and services we all enjoy for free online today…

As an aside to the point today I would be very interested in some exceptions to this rule if anybody has one – ie where has Google sacrificed significant revenue long term in an effort to improve the internet ecosystem. Please don’t use stupid examples like “no ads on home page” which arguably would have lost market share and hurt Google in the long run. Too many ads (I can say from personal experience trying this tactic) often fails users and gets you in trouble. Google has been brilliant at optimizing the advertising equation for their profit. Nothing wrong with that at all, but I’d sure like to see some cases where they sacrifice their own interests for the greater good. An area where this remains desparately needed is in advertising quality control and site feedback for mom and pop websites. Google has made hundreds of millions running ads for sites that are exploiting customers, running ringtone scams, and worse. This situation could improve but it would impact Google’s bottom line and be expensive to monitor since the exploitative sites are very clever, change, etc.

The latest example of Google advertising innovation are tests running now that will match your site viewing history to the ads you see. The idea at first glance is very reasonable – Google can better determine your intererests using this data combined with the immediate “on page” information at a particular website and then deliver ads of more interest to you from their huge stable of online advertising.  However given some of the matches we find at regular Google for scammy companies with questionable business practices (I just had such an experience buying a camera I wrote about over at Technology Report.   I found the “discount” via Google’s ad for Broadway Camera and their salesman then misled – I would say boldface lied – to me to upsell unneeded accessories.    In that case I got some satisfaction after two calls to customer service, but clearly this and thousands of other companies advertising at Google have very questionable sales practices.   Yes Google could monitor this using community feedback and as far as I know they do little to screen for anything but illegal advertiser behavior.

Although some online company abuses fall into under  ‘Caveat Emptor” = let the buyer beware, there is no good reason – other than profit – for Google to effectively place their stamp of approval on questionable online merchandising.     Quick example (there are tens of thousands more)  is right here with Google’s ads for “Free Ringtones” which, for those of you silly enough to think they are free, arent’.   This is not a suggestion!   DO NOT BUY RINGTONES *EVER* and make sure your kids are not buying them.  This is one of the biggest scam markets of all time.

The “real solution” Google could implement with respect to advertising would be to more aggressively remove advertisers who have a lot of complaints from users.    ie  become an advertising ombudsman and policeman.

So, when we combine the predatory advertising practices we find at the regular listings with the new context matching how will things shake out?

Dunno, but you can bet Google will be turning a good buck on the deal.

The Man Who Sued Google – and won $731


The following fun item came up today from Aaron, who managed to sue Google in small claims court over a Google Adwords / Adsense dispute and actually ….. won the case.  Here’s the story.

Adsense expert Jennifer Slegg suggests Aaron may have been violating the terms and I think most advertisers would agree that we want Google to police Adsense very carefully to avoid the many problems that come when publishers’ material is unlikely to generate business for the advertiser.

However I’m also very sympathetic to Aaron’s criticisms of Google’s failure to bring enough transparency to the adsense and ranking processes despite very noble individual activity by guys like Matt Cutts, Adam Lasnick, Brian White, and pretty much all the engineers I’ve talked to in person. My beef is with Google’s company policy of sharing too little information and having “too weak” diagnostics that don’t allow webmasters to fix common problems or challenge fairly subjective ranking decisions, especially when what Google sees as questionable linking activity is involved.

Google suggests that ranking opacity prevents spam where I’d argue that on balance it would help avoid many common practices that now penalize people without them even knowing. Just last week, for example, Matt pointed to a very expensive Forrester business report on “legitimate” SEO approaches that suggested a “paid blog posting” tactic that could get both the blogger and the referenced site in ranking trouble with Google. Although Matt is one of the last people at Google I’d accuse of being “too secretive”, the overall policy is too opaque to reasonable let legitimate webmasters make the best decisions for their sites and clients. The Webmaster Console has helped but it’s too little too late in my view. Google owes every webmaster a clear answer to the simple question: Why is my site ranked below clearly inferior sites? Usually this answer would involve a downranking from link manipulations, selling links to other sites, or other things Google finds offensive and lists vaguely in the Webmaster Guidelines.

I do complement Google on the fairly new webmaster forums feature which can be very helpful in diagnosing problems with websites:
http://www.google.com/support/forum/p/Webmasters?hl=en

Marissa Mayer on Charlie Rose


Marissa Mayer on Charlie Rose. Two of my favorite people at the same time!

Mayer is one of a handful of people who drive many key online innovations as a result of her role at Google. Mayer’s background at Stanford is in AI, and it is very clear that she will remain a key player for many years in the technological changes now sweeping over the legacy industrial landscape.

Visit the Whistle Stop in Talent, Oregon for Coffee


Here in Talent, Oregon we’re lucky to have not one great coffee shop but two, each with a different “personality” to suit your mood or temperament. Where Downtowne offers free wifi, the Whistle Stop is the place to go to mingle with the city.

I’ve written before about the Downtowne Coffee Shop but also wanted to give the Whistle Stop Coffee Shop a big shout out as they serve great coffee and tasty light fare like pastry breads and scones. If you want to feel the heartbeat of Talent, Oregon drop in to the Whistle Stop and say hi to Marina, the owner of the Whistle Stop who was recently voted Talent’s friendliest barista. The Whistle Stop is located right next to city hall on Main Street in a beautiful rennovation of Talent’s Railroad Station. An hour and a coffee at the Whistle Stop will introduce you to our fine little town in no time.

Economy: Are we there yet? Yes, we are. The Jim Cramer $25,000 Challenge


Update:  Thursday saw a big DOW drop of about 300 where Friday was up a bit so I continue to think we are near the bottom unless we see some strong indications that the stimulus will fail.    I think traders are basically waiting for new details on the stimulus and economic plans and trading quickly as that information filters in.   I suppose the coming challenges with consumer debt may not be fully factored in yet but one would think they probably are and the new news will be along the lines of whether the stimulus is stimulating or not.     I understand consumer debt sits at 4.5 trillion as people lose their jobs and home values and thus ability to repay.   I am concerned that the stimulus is directed at bureaucracy rather than powerfully targeting lower and middle classes with massive jobs and debt relief and the upper class with innovation incentives, but I ain’t no economist.    Of course the economists don’t have much of a track record…either!

With the DOW up about 150 points today [Wed] at the close, and optimism flowing about how China’s Government will pump up their economy soon, it is very tempting to think the worst is now behind us. Tempting because it’s probably true, at least for the next several years. My view (as usual with the caveat that you are as likely to gain trading insights from me as from the worthless punditry on CNBC (Yes, I’m talking to YOU Jim Cramer and I’m happy to bet you $25,000 you can’t outperform me in stock picking over any future period you choose). Don’t get me wrong Jim – you are very *entertaining* and I’m sure a fun guy and I enjoy your ….BOOYA! Silly TV show.

I’m just saying that you just have no more insight into picking stocks than a deranged chimpanzee picking stocks by urinating on a copy of the Wall Street Journal. * * *

Pessimists and doomsayers are pointing to the great depression where the initial 1929 market dive was followed a few years later with the DOW all time low = 41, some 80% lower than the *day after the 1929 crash*. This model of market behavior suggests we are in for a lot more trouble, but I think conditions now are so different that we cannot use that history as much indication of what lies ahead. The most important difference in my view is that the Government now is much more prominent and economically powerful than it was in 1930s, and even more importantly our Government is about to inject more money into the system than at any time in human history – more money than anybody can reasonably imagine.

Despite the inane and irrelevant rantings of the Four buffoons of the Republican Apocalypse – Rush Limbaugh, Sarah Palin, Sean Hannity, and Joe the Plumber – the stimulus is very likely to at least have something of a positive short term effect on the economy, and the new role of Government as more of an economic babysitter than before is hardly sending us down some slippery socialistic slope from which we’ll never recover. In fact look for China to recover *first* from the recession for the very reason that when the going gets tough, China’s CapitalCommunist style economic system allows much faster and simpler implementation of the kinds of intervention that the Obama administration is struggling with now.

Thoughtful conservatives are suggesting there are likely better ways to stimulate the economy than pour hundreds of billions into state and federal government infrastructure projects and that’s certainly true, but we’re hearing very little about constructive alternatives to the contruction projects that will form the backbone of this initial stimulus.  Rather, Republicans are now so busy trying to tear down the stimulus and (absolutely moronically) blame Obama for the crisis as if his 40 days in power somehow trumps the past 8 years of fiscal mismanagement and massive government spending which itself was only a part of the current problems.    As I’ve noted before there is far too little attention on the single biggest group of culprits in the whole fiasco – everybody with a mortgage on their house who borrowed money, responsibly or not.   It was this flush of paper wealth and the lure of more that provided the fuel for the derivatives and banking excesses.     Many of us did not act irresponsibly or irrationally when we took advantage of the massive consumer lending boom with cheap and easy loans, but we also can’t claim that we have nothing to do with the problem just because we are not defaulting on the mortgages.    Sure I’m for punishing irresponsible people and businesses – that’s a major part of what keeps our system better than others –  but I also understand that I’m going to have to foot some of the bill for this mess even though I didn’t do anything wrong.

So, have we hit the bottom on the indexes?   I say *yes*.   We hit it yesterday and we now have more reasonable values for our fine American companies.    Will things soon bounce back to their former glory?    No way.  The recovery will be slow and I think slower than the optimistic numbers we heard from Obama’s team yesterday.    I’d guess it will take a decade or more before we see a DOW at 14000 again, with the caveat that we may see some spectacular, game changing innovation  (e.g. conscious computing, near-zero cost energy) that would change everything very fast, leaving our entire global economic infrastructure in the dust.   However I doubt we’ll see anything like that for many years.

*** Yes this is a real offer of a $25,000 wager subject to any legal restrictions that would restrict it. Money would be held by an escrow service of Jim Cramer’s choosing. Period would be picked by Jim Cramer. “Better performance” would be defined as a greater total return on the portfolio over the period without regard to fees or expenses.