Category Archives: advertising

A Slap in the Facebook?

Posted on by
4

Facebook’s recent announcement of their new advertising platform – one that is better targeted to the information they have about Facebook users – has not been greeted very favorably by several bloggers who are basically suggesting this is a “sell out” of Facebookers.    Matt Ingram has a clever post noting how *annoying* this type of advertising might get and also how annoying it is that Facebook thinks you can really meet a person’s targeted information needs running ads for national brands.    Valleywag and even CNET were more blunt about this, saying that Facebook just “bastardized” it’s user base.    

Yikes – I don’t want to be a Mark Zuckerberg User Base Bastard!  

The idea that my use of Facebook means I “owe” Facebook something went out with the massive monetization of the web.  My eyeballs have value to Facebook that, as of last week’s launch of Open Social and the MS Facebook deal, appears to far exceed Facebook’s value to to me.  Unlike Matt I do like Coca Cola but I’m eventually going to go with the social network that gives me a piece of their action.  Is it greedy to ask for that? Maybe, but only about 1/1,000,000,000 as greedy as Facebook or Google. I can live with that level of greed, and I can live without Facebook, or Google, or any single online environment.  There are hundreds more where you came from, and don’t forget that you big internet players, or if I have anything to say about it you’ll become … small internet players. 

My initial reaction to the Facebook revolutionary-never-been-seen-on-earth advertising news was basically in the “so what?” category because I think this type of targeting in social network websites is overrated, and Facebook’s Coca Cola partnership is an indication I am right.   Are they seriously telling Coca Cola they are profiling for pop drinking? Youth?  Caffeine addiction?  Obesity?   That’ll allow them to filter out, what, 14 people from the  50,000,000 users of Facebook?   “Mr Coke we’ll only be running those ads on our the super targeted Coke drinking Facebooker user base of 49,999,986”. 

Hyper targeting of online advertising works extremely well when peole are searching for information about a topic, especially information related to purchasing a product.   Google’s built an empire with the profits from this approach which uses targeted pay per click advertising called Adwords (at Google search) and Adsense (at other publishing websites).    However intuition and some indications from current advertising failures suggest that Social Networking is not very fertile ground for high value advertising.    There are exceptions to this – at a recent conference I talked to a marketer of a very targeted national educational service who said Myspace offered him great ROI and a huge number of leads.   There, the demographic matchups seemed to overcome the tendency of people to simply ignore advertising while socializing.   

Print Media Future – so dim, you won’t need to wear shades.

Posted on by
3

Two articles today suggest how tough it’s becoming to turn a buck in the print media world.   Jeff Jarvis at BuzzMachine and founder of eWeek, notes in “Whither Mags”, that major print efforts require a huge capital outlay before they can even hope to be profitable, and that the current high risk associated with print publications means we probably won’t see nearly as many new big magazine efforts.   

Even more ominous is the New York Times report today showing circulation declines almost across the board for US Newspapers.  The  NYT Article “More Readers Trading Newspapers for Websites” has a great graphic showing how circulation has fallen at most newspapers since last year with an average drop of 2.4%.    Given the relatively thin profit margins at many papers and the fact many costs are fixed this does not bode well at all for the future of newspapers.   The future of news?   That is a far more complex question and I think the answer is not knowable at this time.    Blogs are picking up some of the journalistic slack, but I’m not convinced they can pick up all of it. 

Google to everybody: Open up and say “Google”

Posted on by
2

Matt Ingram  has it right again – Google sees Openness as a competitive advantage, but Google is also correct that Open Social networking and open cellular software and hardware are in the best long term interests of the internet community.

The tech blogosphere has been abuzz for several days now with Google’s message of Open Social Networking (Open Social) and Google’s gPhone / Google Phone / Android / Open Handset Alliance.   Open Social will bring a very open architecture to websites and networking while  Android will craete very open software and presumably unlockable and open hardware for the mobile market.

Is Google being generous?    Not really – they correctly see this as a path to even greater Google profits from advertising.    Google scoops up some 50% of all online advertising revenue now, and this is likely to continue until Yahoo and Microsoft get their advert-asses in gear, which does not appear to be happening anytime soon.    So, while the long term consequences of openness are very unclear the short term benefits are going to go to … Open up and say it loud … GOOGLE!*

* No, I would not recommend buying GOOG at $700 per share.   This pretty much anticipates a smooth transition to a Google world, which seems unlikely.  The internet, after all, is not driven by rocket science … it is driven by … advertising.

Mark Cuban on Open Social v Facebook: He’s being lazy, not smart.

Posted on by
2

Mark Cuban generally has great insight about the online landscape but I think he’s just being a lazy social networker to suggest that Google’s Open Social is too late to the social networking party – a party Mark seems to think is going to be run by Facebook regardless of what the other players do.

Don Dodge of Microsoft also seemed to be thinking along these lines when he noted that 50 million users is nothing to scoff at, and suggested the rumors of Facebook’s death have been greatly exaggerated (agree with that).    Mark also correctly points out that those 50 million are mostly “real people” with real profiles, sharing important personal information that would make most advertiser’s drool over the targeting prospects.

But as I noted over at Mark’s place:

Mark I don’t follow why you think Open Social is “too late”. Facebook only has 50 million people. Within a few years there will be billions of people with social profiles and even if Facebook opens up (as they must), a lot will choose to enter this from other social networks or websites that have “socialized” via the Open Social.I don’t see why Facebook should get all the social glory – they weren’t first to the table and they are by no means the last viable way to socially empower yourself online.

Dude…I just think you are lazy and don’t want to set up all those friends again for next year’s Dancing with the Stars.

[Mark has thousands of friends on Facebook and had asked them to vote for him during his recent performances on the TV show “Dancing with the Stars”.    He’s out now which, to me, is yet another tiny indication that social networking is still very much in its infancy.

Google Phone, Android, and the Google Mobile OS

Posted on by
2

More details about the Google Phone are shaking out, with a press conference expected Monday to announce the big plans.   NYT has a great profile of Andy Rubin, Google’s gPhone Meister who started Android to develop a better mobile device and was then aquired by Google.

It now appears that the mobile Operating system will be available on some phones in development by Google partners shortly, but it’ll be the middle of next year before we see an actual Google phone.    Andy Rubin’s role does appear to indicate that Google will put out it’s own hardware device though, which will be something of a full circle for the company.    Few may remember that Google’s initial business model called for major deployments of a rack mounted search server called a “Google Appliance” that would search internal enterprise networks for documents.   I’m guessing, but I think Eric Schmidt would initially have scoffed at the idea that Google would rapidly become an advertising empire more than a technology and hardware empire, and that revenues would come 99% from advertising with almost nothing from the search appliance business.

Now, with the Google Phone, they may just do it all.

Google Phone – gPhone’s Android is landing?

Posted on by
2

Google is *incredibly* good at keeping secrets, and the rumors of a new gPhone or Google Phone have been flying for some time.   However CNET’s Tom Krazit is reporting tonight that Google, on Monday, will unleash “Android”, an open source approach to mobile phones.     As they have with Open Social, Google will unveil an open source approach to development of mobile software.    How do you know it’s going to be good?    Google does not do bad software.   In fact the Apple iPhone’s most compelling feature – mapping – was driven by Google software.

As I noted before about  Google’s Phone ambitions this is another brilliant move which is clearly seeking to dominate the mobile advertising space rather than try to develop and market new hardware.   

Google’s mantra could not be clearer if it was listed on every home page on earth:  “Free software by anybody and for everybody.  Monetization by ….. Google.

The Social Network Reality Show: High stakes, big money, false rumors.

Posted on by
2

The game is social networks.  The stakes are very high, and the news and rumors are flying fast, furiously, and inaccurately.   Here is the latest in the saga of Google’s Social Networking entry which, with Myspace’s participation, is the new Social Networking juggernaut (though it remains to be seen how all the participants will use it). 

More on the Open Social vs Facebook battle for the hearts and minds of developers and, far more importantly, users:

1)  After a 240,000,000 partnership with Microsoft the blogs (including here) lit up soon after suggesting that Facebook recieved another 500 million from two other private groups.   This was false.   It is very conspicuous in my view that the rumor rose and spread so fast, and that Facebook did nothing to quell that rumor.  This news is still shaking out over at TechCrunch which reported the rumor of the 500 million and now reports it was false.   Another example of how news at the speed of real time may not be news at all.

2) Google says Open Social is open to Facebook and all are welcome (I believe them).

3) Facebook says Google was not keeping them in the loop on Open Social (I believe that as well)

4) Facebook says they may join the Open Social movement, but suggest they have their own great stuff coming shortly.    I’m skeptical they can “out open” Google, though they probably could come up with some great new social networking applications quickly.  

However on balance I think Facebook really is in big trouble here.     Much of the recent hype – which was overdone anyway – assumed that Facebook would be the key beneficiary of the boom in social networking.   The reasoning suggested that although Myspace is  bigger than Facebook it was a “closed” environment, favored by a demographic that has far less value to advertisers.    Facebook, that thinking went, will continue to grow explosively, open up gradually, target advertising very directly, and become the dominant social networking platform. 

Then there was Facebook’s refusal to sell to Yahoo for a reported 1+ billion.  This was followed by big negotiations with many key players, culminating a (much overhyped) 240 million deal with Microsoft to cooperate, run MS Live searches, and drive some MS and Facebook advertising.    Then came the false rumor of 500,000,000 more in capital which for many seemed to solidify Facebook’s valuation of 15 billion – a somewhat sloppy projection of the Microsoft partnership price.

So, what is Facebook worth in an Open Social world where even Myspace is a Google partner?   No, the answer is not 15 billion.

Myspace to join Google’s Open Social. Facebook’s value plunges.

Posted on by
5

It is a mildly risky but potentially brilliant counterstrike against Facebook’s rising popularity.  Myspace will announce shortly that they are joining the Open Social movement spearheaded by Google and which is now officially a social juggernaut of global proportions.    TechCrunch seems to have the latest on this breaking story.

If Facebook was worth 15 billion yesterday I’d suggest it just dropped by more than 50% in value.   Why?   Without Myspace’s hundreds of millions of users Open Social looked like it would be a third player in the field, struggling to catch up with the user bases of Myspace and Facebook and keep up with Facebook development.   But  not any more.  With Myspace, Open Social instantly becomes the key social network, dwarfing Facebook by any reasonable measure of prominence.   Can new Facebook partner Microsoft help sway onliners and developers to stick with Facebook’s “partly open” architecture instead of defecting to what appears to be a very open Google architecture?   No way.

Google Social Challenge – users do not follow developers, developers chase users.

Posted on by
Reply

Tech is buzzing with Google’s plan to enter the social network space today with Google OpenSocial, a set of APIs that will allow rapid development of social networking applications across several sites that are working with Google now, such as Friendster and LinkedIn.   UPDATE:  and Myspace

At this point it appears Google Social will not allow better convergence of applications with Facebook, and it seems unlikely (let’s assume a zero percent chance) that Facebook and their new partner Microsoft are going to work hard to make the social network space a big, open, happy family run by Google via Google Social.   UPDATE:  Myspace just joined the Google Open Social Network.

Myspace is still the key player here with some 5x as many users as Facebook, depending on which metric you use to figure out traffic, users, subscribers, pageviews, or attention.

This will certainly lead to a surge of initial activity as developers chase the users of those sites – a user base that is substantial – Marc Andreessen says 100,000,000 users which would be more than twice Facebook’s user base.  Update – Google is now accessing far more of the key users than Facebook.   

  Can Google social resurrect Friendster?    Maybe, if the APIs are good enough that we can carry profiles in and out of sites seamlessly. 

I’m speculating here but would guess that the Google move is going to quickly shake up the Social space into three camps:  Two?  One camp?    Facebook+MSN, and Myspace+Google Social which will tie together thousands of existing and new social environments.    

Facebook is obviously the key player to watch.  The stakes are about as high as they can get and I bet Marc Zuckerberg and his brilliant Facebook gang have corked the champagne bottles and deciding how to move ahead.   Prediction:  They’ll stay the course with moderatly openness and will reject Google Social.

Given that many have been looking for a ‘one stop’ social network stop is there room for more players in this space?   Certainly yes given this open approach.    It’s even possible (though I think unlikely) that enough users would insist on the new open standards that they could push Myspace and Facebook to line up with Open Social.   Update: Myspace is on board now.

Here’s a simpy *superb* summary of the emerging landscape by Google partner and web pioneer Marc Andreessen of Netscape and now Ning.