Oh, That Money Thing Again

A long time ago in a galaxy far away, my cousin Janet was visiting me in Houston. During her stay, we spent a lot of time with a friend of mine (who, incidentally, is one of the characters in my long forgotten and half written novel that became the Mr. Happy stories). Anyway, one night my friend was trying to convince Janet to go home with him. He was getting nowhere and finally she blurted out “Look, I just met you,” to which my friend responded without missing a beat, “Oh, that time thing again.”

That’s sort of the way a lot of these Web 2.0 companies seem to approach their business plans and the obvious, at least to some of us, need to actually turn their nifty science projects into some cash. I have talked until I’m blue in the face about the faulty logic inherent in the ad dollars as a sole revenue source approach. Yet every day we read about another social bookmarking service and another social networking service who plan to take over the world, one ad click at a time.

The lawyers are about the do some damage to those who believe they can toss up a system, let the inmates run wild and sit back and get rich and famous.

Joe over at Techdirt posts today about a new MySpace angle designed to disguise the fact that it’s just more advertising and a new Facebook angle designed to disguise more ad sales as some sort of a joint venture by giving the advertiser some equity.

If I were a VC, I would ask only one question to every startup that I came across:

What is your revenue model, exclusive of selling ads and getting bought by Yahoo.

If I got an unsatisfactory answer, I would thank them and tell them I’m not interested.

It’s that money thing again. In the business world, you simply have to make it. Otherwise, you’re not a business, you’re a hobby.

On a related note, I still want to know, exactly, who clicks on online ads. I have never once (never, not even one time) clicked on an ad on a web site I didn’t own. If you regularly click on online ads, please leave a comment and tell me about it. I’ll devote an entire post or two to this if I get enough takers.

Journaling Does Not a Journalist Make

At least not in the way Scoble means.

I have no doubt that a lot of bloggers got it wrong when reporting Scoble’s move. I also have no doubt that all of the blogging frenzy that went on comes with the territory when you’re popular and in the public eye.

In my semi-humble opinion, the biggest thing holding the blogging movement back today is a complete failure to reach any consensus on what a blog is and what a blog isn’t.

The fact is that blogs are many things. Fun, hard, happy, sad, serious, frivolous. The beauty of a blog is mostly in the eyes and fingers of the blog-holder.

To some, it is a podium to express their views.

To some it is a natural part of their larger purpose.

To some it is a way to explore their passions.

To some it is a living Christmas letter (and I mean no disrespect- that is a beautiful and worthy purpose).

To some it is an evolution in traditional journalism.

To some it is a way to entertain.

To some it is a way to grieve.

To some it is a way to have conversations with people about topics of mutual interest.

To many it is some combination of the above.

Granted, that is no excuse for posting irresponsibly. And it does not exempt bloggers from some of the good practices of traditional journalism.

But to say that bloggers are journalists is to miscast both the nature and the beauty of a blog.

Unless, of course, by journalist, you mean someone who keeps a journal.

That would be pretty accurate.

Steve Gillmor’s Self Fulfilling Prophecy

troll-766659 Steve Gillmor can’t even go two sentences without insulting those who dare to disagree with him:

“Note: trolls should already be moving down to the comment section or, more wisely, clicking off to less elitest and more page-view oriented material elsewhere on the Net.”

Of course, Steve won’t engage anyone, other then his hand picked worthies, in any sort of discussion about the various topics he whines and cries about. He seems content to write about his little cadre of pals and continually call the unworthies who have different opinions “trolls.”

Here’s a good way to build trolls: toss out new and occasionally radical ideas, refuse to engage anyone outside the fanclub in anything resembling a discussion and the call those who express their disagreement names. Ask for trolls and trolls you shall get.

Dave Winer had this to say. I’m sure Dave and Steve are pals and I expect Dave is just busting his chops. But truth lies beneath many a jest.

The difference between Steve and Dave is that if Dave thinks you’re wrong, he’ll engage you and tell you why. That’s all a conversationalist can ask.

The Houston Chronicle Gets RSS

In more ways than one.

Demonstrating once again that someone or ones there really understand the evolving world of information distribution, the Houston Chronicle has added even more RSS Feeds. The Chronicle has been at the top of the internet curve for some time now, and it shows.

I am delighted about the new feeds, because I get more and more of my news via RSS feeds all the time. Part of this is by choice and part of it is because I’m still not crazy about their new web site design (sorry Dwight). The news is too hard to find and the text far too small for my middle aged eyes.

It could be worse, however. The worst web site redesign this side of Geocities is the one The Houston Press did a few months ago. I used to read the Press every week. I haven’t read a single article since the redesign.

CBS Reaches Out to Bloggers

I love it when old media (or their newer offspring) reaches out to new media. It tells me that some smart person has correctly concluded that bloggers are not competing with CBS News, CNN, etc.

I got a Comment to my Google post today from an intern at CBS asking me if I would consider writing about an upcoming series on CBSNews.com. It seems that starting on June 13, CBSNews.com will do a three day series of reports on the “intersection of teenagers and technology.”

CBS is encouraging people to write in with questions or concerns. The email link is in the story linked above.

This is certainly a timely topic and I look forward to reading the articles. I hope the series will be a substantive piece that talks to the right people and asks the hard questions.

Here are some topics I hope they cover:

1) The “fox guarding the henhouse” problem that naturally and inevitably arises when you ask a company like MySpace, which makes money off of traffic, to improve online security by imposing restrictions on the restriction-averse kids who make up the lion’s share of such traffic. It’s easy to hire some consultant to toss out a bunch of gimmes to the eager press, but taking the sort of hard and decisive action needed to be effective is another matter.

2) The emergence of Second Life and other similar sites as the new social network. I want to hear from the developers of these sites as well as parent and teacher groups as to what is being done to make these sites safe and what isn’t being done that ought to be. Second Life should be applauded for having its teen grid, but what I want to know is how easy is it for a kid to sneak into the adult grid and what does Second Life and others do to catch them whey they do.

3) The degree to which technology encroaches into the educational system as a disruptive influence. I can tell you from experience that a lot of the kids in the law school classes I teach are constantly surfing, chatting, etc.

4) And finally, I want them to find the person responsible for that idiotic, indefensible Tagworld ad and ask him to explain in great detail and defend the decision making process that led to that ad.

I’ll write again on this series once it starts.

Synergy Spinergy

Henry Blodgett reports that there is an article in the Walled Street Times (which I can’t read because I’m not going to pay for it) about Time Warner and it’s out of favor stepchild, AOL. It seems that Time Warner has decided that all of that synergy that was going to be realized upon the marriage of Time Warner and AOL isn’t going to come to pass after all.

In fact, Time Warner’s president calls the synergy concept “bullshit.” That’s pretty much how I feel whenever I hear one of those fancy words that mean let’s do this even though there’s no demonstrable benefit to be gained.

Henry sums up this ill-fated deal beautifully:

“Perhaps synergy is, in fact, bullshit–perhaps the merger was doomed from the moment it popped into Steve Case and Jerry Levin’s bubble-addled heads.”

AOL is like the oldies concert circuit- there’s my former hero up there on stage, but man he looks old and I can’t believe he’s come to this.

C|Net and the Return of the Bad Old Days

How deep is the online-ad well?

That’s the question and title of an article by Elinor Mills at C|Net today.

The article begins by recalling Bubble 1.0, during which a lot of people, including me, launched web sites and services that were to be supported by online ad sales. Next, of course, it reminds us that for many of those people, it didn’t work out.

A few “industry experts” are claiming that since Ford and P&G are mad buyers of online ads and because more companies buy into the online ad medium, things are just as rosy as rosy can be. Certainly there are more buyers now, which is why all of Web 2.0, Yahoo, Google, AOL, Stowe Boyd, a baby and even Microsoft are making plays to get the advertising dollar while the getting is good.

And I absolutely agree that the decline of some traditional advertising allotments (because no one watches them and they don’t work) has resulted in a renewed, and somewhat desperate, focus on online advertising.

But here’s the thing. We have a confluence of several industries with a vested interest in placing and receiving ad dollars. That’s why everyone is singing the happy song about the long term prospects for online advertising. The reality, however, is that while this song and dance will prolong Bubble 2.0, it will not prevent an implosion once the entire internet hops onto the shoulders of the advertising dollar. Sure, a few people will get rich in the meantime, as more and more of the overall ad dollars chase the mythical internet ad clicker.

But the basic game is the same as last time. And the result will be substantially the same.

In the meantime, we can watch things play out and battle to protect our privacy as more and more targeting (read tracking) technology is tossed out as reason number one why ad buyers should look online.

The ad agencies who look past the low hanging fruit of the internet and develop the next big thing in advertising (whatever that may be) are the ones who should and will get rich. Advertising is at a pivotal point in its evolution. I can’t tell where it’s going yet. I suspect Steve Rubel has a pretty good feel for it. But I know where it’s not going- online. The smart agencies are the ones who see the internet as a rest stop on the way to a more stable destination.

In sum, I don’t agree with everything that’s in the C|Net article, but I am glad to see someone else asking the dreaded question.

More Advertising Madness

I read somewhere that a good blog should have a consistent set of themes.

So I guess one of mine has become the idea that advertising dollars simply cannot support the entire internet and all of Web 2.0. I feel pretty certain about this, yet every day I read about some great new venture that some famous blogger (which is sort of an oxymoron) who refuses to link to me thinks will one day be bigger than all four Elvises (Presley, Costello, Grbac and Dutton) and whose only meaningful revenue source is from advertising.

toomanyads

First we have all of Web 2.0.

Then AOL tosses in the towel and decides that since nobody wants a closed internet anymore, it will bet on ad revenue to keep its teetering boat upright. The magical $81M in ad revenue notwithstanding, it won’t work long term. There are only four ways to get rich legally: by birth, by gift, by doing something few others can do and by selling a product. AOL was not born rich, will not be given money because it is already public (no greater fool money for you, Mr. AOL), is now entering a mature market dominated by Yahoo and others, and its product no longer sells.

Of course you can say the same thing about most of Web 2.0, and I have. Over and over.

Meanwhile, TIVO, which is still running around like a chicken with its head cut off, has one-upped itself in the bad idea derby by adding ads on demand to last years’ bad idea champion, searchable ads. It’s like the time Raina and I tried in vain to convince the kids that vegetables were actually a treat. It may sound good, but even a three year old knows it’s a head fake.

Last but not least, Jake takes a page from Stowe‘s book (and apparently a hat from his closet) and wants to become a toddling advertisement for $10,000 a month. If he sells a month of ads he will have made more profit than Stowe and all of Web 2.0 combined.

When the advertising house of cards collapses, there is going to be a lot of carnage.

Top 10, Web 2.0 Style

Here’s the Web 2.0 Developer’s version of Guy Kawasaki’s Top 10.

top10 1. We can get Mike Arrington to favorably review our product.

2. If we can finish the under construction page on our website, we’ll get listed in Catagioriz.

3. We can hire Stowe Boyd to be our walking billboard.

4. We’re confident that our product will make lots of money somehow, even though it’s free.

5. Assuming that each user only tells three additional people, we will have an installed base of five million non-paying users by the end of the first year.

6. Google is really excited about placing Adsense ads with us.

7. Conservatively, the total available online advertising available for our website is $50 billion.

8. Even if it’s not $50 billion, we will have sold ourselves to Google or Yahoo by the time the advertising dries up.

9. Robert Scoble really loves what we’re doing and as soon as he gets back from this week’s blogging haitus, he’ll give us many links.

10. Our product is better than the other hundred or so free products that do substantially the same thing.

and, last, but not least

11. Our product is not dependent on online advertising revenue for most of its revenue, it just looks that way.

Save Some Trees – No More Yellow Pages

Craig Newmark points to a petition where you can request that your name be removed from the mailing list for the hard copy of the Yellow Pages. 540 million hard copies takes a lot of trees.

I signed up, for both the Yellow Pages and the White Pages. I haven’t used a hard copy of either in years. I don’t need one copy and I certainly don’t need multiple copies, which I seem to get every year.