Hat’s off to IBM for what could be a milestone in building faster computers. They are making great progress with Silicon Nanophotonics – moving data using light pulses. This technology could speed up current wired chips by a factor of 100, bringing supercomputer power to your … desktop computer.
Kurzweil is smiling about this, and this is yet another indication we are likely to have conscious computers by about 2020. Then, everything is going to change in ways we cannot even imagine.
Om Malik and Matt Ingram are asking why Facebook doesn’t simply ask their 40+ million users to determine what the users would want in terms of advertising on a social network.
Excuse me but are you guys naive or just starting your holiday drinking a bit early in the season?
The answer is that actually using social networking as a springboard for advertising ideas, although it would be totally consistent with the claimed model of what a great social network will be, would be totally inconsistent with maximizing profit. I am *so tired* of hearing people talk about how what is best for us user gooses is best for those advertising ganders. It just ain’t so!
Advertising – even good ads people think they really like – are all pretty much rooted in the old saw “There’s a sucker born every minute”. Sure there are good products, and sure most companies are honest, and I even think many ads are reasonably “true”. But the point is that good ads must inspire buying behavior before they inspire wise behavior, and any marketing effort worth it’s even it’s weight in online ads will work to make buyers, not work to make wise people.
Most wise people don’t buy a lot of stuff unless they stumble upon great wealth, and even then most do not become rampant “consumers”. They reflect, they travel, they exchange ideas, they learn and they love. Shopping? It’s not on the list of activities that spawn great human enlightenment, and it never will be. Fun? yes. Popular? Sure. Profitable for companies? YES! Shopping, and more generally commerce online is the only sizeable revenue source, making it the key to internet innovation and the driver of internet changes. User centricism is generally going to be trumped by this force with some notable exceptions like Wikipedia and perhaps Open Social.
The very best marketing ties real human factors to products, but in the same way “conversational marketing” is an oxymoron it is not reasonable to expect “social network advertising” to be glowing extension of the social networking experience. Maybe in Mark Z’s dreams, but not in his increasingly profit-centric reality.
I’m strongly behind the idea that online community needs should trump profits. Also, I agree that following this mantra can lead to some successes. Google initially frowned on advertising while they built a fantastic search system, but note how it took advertising to make them the key online player they are today. Not a little advertising either – billions and billions and the prospect of billions more.
Can social networkers design ads they like? I doubt it. However this could come about indirectly. Google Open Social is the most likely source of social networking advertising innovation for the very reason that Google *makes their big profits elsewhere*. Google can sweep in with a truly user-centric social model, monetize it to a limited extent using adsense, but from their perspective leave their core cash dow – PPC search – intact. Also, Google then conveniently puts a huge, perhaps even deadly crimp in Facebook’s potential to become a dominant online environment. As I’ve noted before Google is brilliant at managing to do the right thing and in doing the right thing reap big benefits for … Google! (How DO they do that so often !?)
Oh, speaking of NOT doing the user centric thing because it might threaten the cash cow we need look no farther than … Google. Note their ad standards have relaxed quite a bit over the years while keeping “user friendly enough” to avoid the sharp criticisms that should have been levied at Google when they slapped ads on the left side of the home page, conveniently blurring the distinction between organic and paid listings, then stopped prominently shading the advertising. Oh, they also allowed bogus sites to run adsense, didn’t crack down early enough on the spiral of massive click fraud, and have even embedded travel advertising in organic listings while still claiming they don’t do it (example: try this search: “SFO to JFK”).
So, the moral of Beacon is not that profit sites should stop acting like profit sites, rather that since there is a sucker born every minute, we suckers need to stick together, and every so often we need to stick it to the man to keep him on track. Maybe that’s all Om Malik is saying today, and if so I’m with ya!
Mark Zuckerberg is profusely apologizing for Beacon’s shortcomings.
I’m not proud of the way we’ve handled this situation and I know we can do better …
It sure looks sincere to me and I don’t think sincerity even matters all that much in this case. They srewed up, they are fixing things fast, time to move on.
Like many I’ve been cynical of Facebook valuations and some of the ridiculous hyperbole, but this whole fiasco was a great study in now quickly you go from being tauted as “the next big thing” to tauted as being “dead”. Also an example of how major media still does not quite get the web thing – just yesterday we read “Facebook RIP” which foolishly suggested this could be a major event for them.
Google social is a major stumbling block for Facebook, but Beacon is just a tiny bump in the road to more riches. That said I still think 15 billion dollar valuation is absurd. But, I thought Google was overvalued too and I was sure wrong about that…. so far at least.
WebGuild will be presenting the second annual Web 2.0 Conference and Expo on January 29, 2008. The location is the Santa Clara Marriot. I missed this event last year but will be there this time and I’m really looking forward to it. Last year Marissa Mayer was the keynote and I’m hoping she’ll be speaking again. She’s one of the best thinking technologists anywhere, and a major reason Google continues to dominate the online landscape.
Note that this event is not to be confused with the Web 2.0 Expo series put on by O’Reilly Media or the Web 2.0 Summit also by O’Reilly.
OK, it’s time to start getting excited about several events I’ll attend in 2008 – China SES in Xiamen, The Computer Electronics Show in Las Vegas, and the Web 2.0 Conference from WebGuild in Silicon Valley. More about China later as I start to plan that trip with my two table tennis pals, one of whom was born in Beijing. Here’s a great recap of Rand Fishkin‘s experiences last year at this conference.
CES Las Vegas is the world’s most super gigantic humongous computer show. Bill Gates is the keynote this year.
There will be amazing new product launches and thousands of exhibitors hawking the latest and greatest electronic gadgetry. I expect at least a few new amazing Google phones based on Android SDK and literally thousands of neat new gadgets for hands on investigation. Hopefully Scoble and Podtech will host another Bloghaus at the Bellagio. I’d read about CES Bloghaus 2007 last year and it really sounded like the happening place to hang out during the conference as a gathering point and 24/7 watering hole for bloggers.
I’m already getting a lot of emails and some phone calls about setting up press appointments with the CES Exhibitors. For many this is the key place to build the buzz for new product launches. I’ll hope to report on the neatest things I see in travel and tourism as well as anything amazing that really stands out.
Robert’s got a post wondering what a lot of people are wondering right now. Why is Facebook handling the beacon advertising fiasco so quietly, poorly, and stupidly? However, I think they are right to lay low and wait for this to die down, then suck up with their advertisers and be back at the bank within a week.
1) Sure, overall there is arrogance here, though Facebook has some reason to puff out their chest given the number of takers at their recent 15 billion valuation (well, it was only 2 takers, but …)
2) Mark Z is a young buck, and Facebook is a young company. They went from handling the claims they were the next big thing and would beat out Google to claims they are the antichrist company, stealing users souls. They are neither, they know this, and it’s hard to react to all that crap so they are not reacting much.
3) BlogOsphere exaggerates problems to a degree that is absurd, and this will mostly go away soon unless users leave Facebook in droves. Users leaving is unlikely. Bloggers forgetting about the beacon fiasco is … less than 10 days away.
4) Advertisers don’t really care much about this. Credibility is an issue but that will be addressed privately. Probably Zuckerberg will need to step down as commander given this, and that may be a significant development. If Facebook wants an IPO they’ll want to pull a Google and hire an old guard CEO to manage the kids in the office. If they don’t – sell that puppy short.
OMG – Facebook scandals are totally boring already. Can’t we talk about interesting things in Technology?
One of the neat futuristic gadgets in Star Trek was the universal translator, a device that would take in any language and output English.
Engadget reports that NEC says they are close to having one of these.
the firm has developed a system that can understand around 50,000 Japanese words and translate them to English text on the mobile’s display in just a second or two.
Now this is not quite Star Trek because you’d need to convert the text to voice, but that technology is here already. This is close, and it’s just another in the long line of technological improvements we all call … home.
I see this as very fertile ground for the open handset alliance. Just think how positively travel would be affected if the language barrier was stripped away! Perhaps even less conflict as people would find it harder to keep from communicating during crises.
Back in July I missed this great post by Dave Morgan at AOL but thanks to Danah Boyd’s post it has surfaced again. The findings are very surprising and very relevant to anybody running click or online advertising campaigns. Dave summarizes the findings very concisely as follows:
We learned that most people do not click on ads, and those that do are by no means representative of Web users at large.
Ninety-nine percent of Web users do not click on ads on a monthly basis. Of the 1% that do, most only click once a month. Less than two tenths of one percent click more often. That tiny percentage makes up the vast majority of banner ad clicks.
Who are these “heavy clickers”? They are predominantly female, indexing at a rate almost double the male population. They are older. They are predominantly Midwesterners, with some concentrations in Mid-Atlantic States and in New England. What kinds of content do they like to view when they are on the Web? Not surprisingly, they look at sweepstakes far more than any other kind of content. Yes, these are the same people that tend to open direct mail and love to talk to telemarketers.
What does all of this mean? It means that while clickers may be valuable audiences, they are by no means representative of the Web at large
Indeed, this means that many online marketing campaigns may need to dig a lot deeper to obtain a positive ROI, and for some campaigns positive ROI is not attainable. If, for example, irrelevant clickers (not to be confused with click abuse) mean you’ll have to spend a few dollars to reach a single prospect, and your margin on your product is only a few dollars, you may be fighting a losing PPC battle for online hearts, minds, and pocketbooks. On the other hand if your target audience is, say, midwestern stay at home soccer moms, you may want to up your PPC spend dramatically because your nickel or dime per click could be worth many times that in prospective sales.
Obviously Dave’s post is only the beginning of the big story which has yet to be written, and I’m not clear how representative this sample was of all PPC activity (I think it was broadly representative though – they looked at billions of data items). However this helps me understand why some of my PPC experiments have failed to yield much of a return. A good travel experiment given these findings would be to look at midwestern travel patterns and try to advertise popular packages to Mexico or other commonly travelled points south in the winter. Since women are the main travel planners this match could work well to increase the normally very low conversion I have seen on travel related PPC spends.
I owed a friend a pretty good bottle of Scotch for a favor, and knew he liked Oban Scotch. Unfortunately I had not checked the local price which is consistently $69.95. Not bad, but I was shooting for a $50 “thank you” gift. Enter the internet shopping thingie at Google which offered up Turnpike spirits way out east as having the best price by far on Oban – $42 plus shipping. Unfortunately the website showed “not available” so I called them and got excellent help. He had some bottles and I managed to order 4 of them. With shipping I’m going to be under $50, and have a few more nice gifts to give. Hey Dad – don’t read this post!
Shopping for scotch shows that the internet has not stabilized pricing at all – at least for Oban Scotch. This single product has dozens of different online prices, which is especially interesting given that locally the price seems almost “fixed”. I’m guessing few people buy liquor online – perhaps it is an impulse or very-close-to-Christmas purchase usually and therefore people go local? However it would seem this price inefficiency could be monetized somehow by matching low online pricing to high priced areas. I’m guessing that our local liquore store paid more for the bottle they are selling at $69.95 than I just paid Turnpike, so somewhere in here there is a business.
The Amazon startup contest here has a video profile of the seven finalists in their contest which I think was to showcase users of Amazon Web Services (AWS). I think Jeff Barr will have more about this on his blog or on Amazon’s blog.
These look like some really interesting companies. One is measuring brain networking, another is providing 19 usability testing (this is brilliant for the small website market!) One is optimizing PPC campaigns (hmmm – but won’t Google analytics do that extremely well?.)
Joe Duck 