Is online news worth less than offline news because less time is spent reading it (both absolutely and relatively), because of anchoring at "free" and because of commoditised online ad rates? Well...sort of. Partly. It's true as far as it goes.
First, this isn't about news.
Continue reading "Little more than a glance at the new economics of news" »
It always worries me when I see companies launch that it seems any one of a dozen other companies could trivially kill with a few days dev work. I wonder if I'm missing something.
SalaryShare lets you see what your friends/colleagues/random strangers earn by pooling salary data anonymously from anyone who chooses to share it and then revealing the range of salaries disclosed to all participants. Nice idea. I have indeed occasionally been curious as to what other people earn.
Thing is...if people want to know that badly, can't one of the jobs boards (or more usefully jobs aggregators) simply store data on the salaries that were listed on historical job ads and make it searchable?
Continue reading "Salaryshare and the data opportunity for jobs aggregators" »
It occured to me yesterday that Amazon should offer a dating service.
They have all the information that it could possibly be useful to know about a prospective partner. How much do they spend on books? Which books do they buy? How close to publication date do they buy the important ones? Their reviews record would probably be handy too, just to make sure they understood what they were reading. Amazon has locational data for all its customers of course, so all they'd need to do is tweak some privacy settings, add a photo upload facility and let people search for cute potential partners near them who love the same books.
I've been thinking about the new Internet bubble for a while: today I saw what, for me, clinched it that the bubble is back. Here, in order, are the six signs that we're in a new net bubble.
(1) Hugely improbable specialist etailers like iwantadoor.com advertising (indeed sponsoring) prime-time TV shows. When I saw them appear in the sponsorship slot tonight I immediately knew I was looking at the next Pets.com. That's not a happy connection for any company and it's not a happy moment for our market.
(2) Massive valuations placed on stocks that have never returned a profit. Demand Media (even with all its weird accounting) still wasn't making a profit when it got listed at $2bn. HuffPo just got bought as it went into marginal profitability. People are spending billions to own businesses that have yet to return a penny. That's not healthy, rational investing. That's dumb money hitching itself to a rising bandwagon (yes, I just said "rising bandwagon") and hoping to offload the shares before it falls.
Four months ago Craigslist pulled the Adult Services section on its US websites. Quietly, without fanfare or announcement, but all the same they were gone. Then at the very end of the year the company confirmed that the section had been removed from its sites worldwide (slightly oddly, since it was pressure from US Attorneys General that caused the original change, but all the same they're gone too).
The removal of the section was estimated by AIM Group to cost Craigslist $36m pa or about a third of its total revenue. But for a company that famously doesn't care about the money, this can hardly be a significant issue. What matters is whether it costs them traffic and the opportunity to connect people with the services they want to find.
Continue reading "How hard has the loss of adult services hit Craigslist's traffic?" »
On Wednesday the AOP released the results of a survey on "the relationship between consumer engagement with website content and how it impacts on their reaction to advertising on different website types: original content sites, portals and social networks."It found that approximately twice as many respondents to the survey trusted the advertising on content sites as on social media
It raised some questions for me which I posted here. If trust and engagement are such key indicators of the value of online advertising, how can content sites maintain CPMs that are ten times greater than those achieved by social media when their own research is able to show only twice as much trust for their advertising?
New research commissioned by the AOP, and reported by Journalism.co.uk earlier today, shows that
"...engagement and advertising responsiveness is strongest on original content sites compared to other site genres. Respondents are almost twice as likely to trust advertising and brands on content sites vs. social media sites".
Journalism.co.uk also highlights some detail from the report: "respondents were significantly more likely to trust advertising on content sites than social media sites, with 59 per cent trusting content sites compared to 34 per cent for social networks."
Which is hardly good news for those original content sites which (at one remove) funded the report, given that as it stands they achieve CPMs almost ten times those achieved by social networks for what they appear to have just proven is only twice the value.
Continue reading "New AOP research shows content sites overpriced versus social networks" »
Earlier today the FT broke the news that the Telegraph is (probably) joining the Times, FT and indeed News of the World by putting up a paywall next year. A spokesman told Reuters by email that "absolutely no decisions have been made on the introduction of a paid-content model," but a number of Telegraph execs appear to have confirmed to the FT that there would be a paywall in place before the end of 2011.
Paywall experiments over the past ten years have been a disaster for online newspapers. However, the Telegraph's move could perhaps be justified by two fundamental changes to this market - an increased scarcity of professional journalism online, and the effective collapse of the Telegraph's current commercial model, occasioned primarily by Facebook.
Continue reading "Why a paywall might make sense for the Telegraph this time" »
The most recent trading in the secondary market valued (unlisted) Facebook at $50 billion - more than venerable sites such as eBay or Yahoo, and within sight of Amazon's c$80 billion. Since this latest valuation is little short of fifty times Facebook's estimated 2010 revenues of $1.1 billion, it raises the question of what has to be believed about Facebook's prospects for that valuation to make sense.
A quick comparison of Facebook with its approximate peers - major consumer technology retailers, websites and especially social networks - shows a chasm between the value placed on the revenues of other companies versus pure social networks. (Revenues rather than profits are used throughout because profits at Facebook are unknown.) But the things we have to believe for a valuation of $50 billion make sense just aren't all that wild.
A recent post by a disaffected San Francisco restauranteur complains eloquently that Opentable is sucking the whole margin out of the restaurant business just for processing the bookings - about $10 on a four-cover booking, which assuming that table spends $200 at a normal 5% margin means Opentable is keeping all of the profit on the booking leaving the restaurant with, err, nothing. If that's true it's bad for restaurants but bad for Opentable too - a parasite that kills all of its hosts doesn't have much in the way of long-term prospects.
The bad news for the restaurant industry is that the problem of Opentable carving out a position for itself as a new middleman in the eating-out value chain arose because of a basic strategic error made by the restaurants themselves. The good news is that the error is relatively simple for the restaurants themselves to reverse.
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