Posts about Business

Yahoo, indeed

April 9, 2008 by Jeff Jarvis
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As a Microsoft shareholder, I’d be delighted if they are saved from buying Yahoo. As a Time Warner shareholder, I’d be delighted if they were saved from owning AOL. But I do think a Yahoo-AOL lashup is this is Dumb and Dumber, Incorporated. Who would run the thing? None of their current bosses, I’d hope. What would the strategy be? Nothing like what it is now: get out of portalthink and get into platformthink, please.

: LATER: A reporter asked for my take and predictions on the MyMicroYahOLSpace orgy. I said:

First, I think a Microsoft-Yahoo combination made little sense. It was Microsoft’s attempt to buy audience — as if you can own audience today, as if we can be bought and sold. That is the old-media way of looking at the world: they controlled content, marketed to get people to come to you, showed them ads, then waved good-bye.

The new way — the Google way — is to be distributed, to make your content, brand, and advertising exportable and embeddable (as with Google AdSense or YouTube videos or Google Maps). I believe that both Yahoo and AOL should follow that example, making everything they have exportable, and becoming a platform for individuals and companies to create and mash-up content and even start businesses.

The other opportunity is to become the ad network for this distributed world. Problem is, Google got there first. AOL and Yahoo have invested fortunes in ad platforms. Again, they did this in the old-media manner, trying to aggregate audience and networks under their roofs. Google, meanwhile, not only bought DoubleClick but also opened Ad Manager, which will serve anyone’s ads for free (and give Google the chance to serve its own ads when sites want). That will expand Google farther and faster than any acquisition like Yahoo or AOL could. If Google can also expand via Yahoo and Yahoo can get more revenue from that than from its own advertising — which says a lot about Yahoo’s strategy — then fine; but doing anything you can to avoid Microsoft is not itself a strategy; it’s a move of desperation.

Microsoft is trying to buy the online strategy is still has not managed to build on its own.

Yahoo and AOL are trying to regain an online strategy they lost. Will they be better together than they were apart? It depends on who manages them and who comes up with a strategy. Clearly, the incumbents at both companies have failed. This takes new leadership who understands the new architecture of the media world and I’m not sure where they’ll find that person. Trying to lash together these two failing strategies and cultures and come out with something new is a thankless task.

News Corp., meanwhile, is being very clever in trying to offload some of the risk of MySpace. People ridiculed the purchase when it was made. It turned out to be smart, as so often happens with the moves Murdoch takes that others ridicule. MySpace is worth more but its strategy is also somewhat unclear as Facebook — and even new platforms like Twitter — build deeper relationships with their members. So if Murdoch can get value out of MySpace now, at a high, and lessen his risk, then he’d be happy.

At the end, I think Microsoft could still win because it is the only one willing to pay much of a premium. Time Warner is a bit desperate to get rid of AOL but it won’t value it too low after having valued it way too high. News Corp. has already shown it is not willing to pay a premium and will only go along for the ride if someone else does.

There goes the neighborhood

March 13, 2008 by Jeff Jarvis
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(CommentIsFree asked me to write this post about AOL acquiring Bebo.)

Poor Bebo. I feel for the residents of their hip and convivial apartment block. It has just been bought by a slumlord.

AOL — which is paying $850m for the social networking site, the other Facebook — is where innovations go to die. Remember Netscape? Bought for $4.2b and now dead. AOL bought a mess of advertising platforms — Advertising.com, Quigo, Tacoda — and can’t make them to get along; the New York Times reports on continuing warfare that has resulted in AOL firing the business talent it just acquired. Back in 1998, AOL bought the pioneering instant-messaging platform ICQ and though AOL’s IM went on to become huge and though ICQ lives still, it was never the leader again. And then there’s what AOL did to Time Warner and its stock (which I bitterly regret holding onto from my days working at the magazine publisher).

In its purchase of Bebo, AOL — like Yahoo, Time Warner, Microsoft, and no end of media companies — is trying to buy the strategy it doesn’t have. And that’s a strategy that rarely works.

The terrible irony is that if anyone should have understood community and how to support, nurture, and profit from it, AOL should have. The problem is that AOL never understood its real value. At various times, it thought it was an internet service provider and then a portal and then an ad network. But all along, AOL’s greatest asset was the community of people under its nose: millions of enthusiasts in countless niches meeting and enjoying each others’ company in forums and chat and personal pages, the platform for community that AOL created.

AOL should have been Bebo before there ever was a Bebo. It should have been the Google of people. It should have been Facebook. Instead, having killed the golden goose of its own community — one it created as the social pioneer of online — it is going to the market to buy a tin gosling.

So what will become of Bebo? I shudder to think. These acquisitions rarely work well. We can look not just to AOL but also to Yahoo, which bought the wonderful photo service Flickr and bookmarking service Del.icio.us. Both live on but without the rush of innovation that made them so valuable and Yahoo has saddled each with its own klunky membership structure.

If history is any guide — and in AOL’s case, it certainly is — I fear that Bebo’s talented, visionary founders will leave in frustration or firings; AOL will bury the service inside its outmoded portal; and AOL will treat the people inside not as people but as ad inventory.

But then, maybe I’m just a pessimist.

No happy endings

June 19, 2007 by Jeff Jarvis
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A blunt assessment of the newspaper industry at Poynter: “Business has been terrible for a year now, it’s bad today and it will stay bad for quite a bit longer.” The trends aren’t going to look good. What’s needed are radical break-out strategies. What should local be online? I have my ideas, some of which I’ve blathered about here. What are yours? I think the question starts, again, not with what a newspaper can or should be but with what local means online.

DuPont’s internet-video ads on blogs

March 19, 2007 by Jeff Jarvis
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DuPont just launched a new series of internet-video ads — stories about science starring Amanda Congdon — that they are placing on blogs. Steve Baker of Business Week writes about it here and Josh Bernoff of Forrester here. Here are the videos with Amanda in a white lab coat, which has to be someone’s fantasy.

Full disclosure: I consulted on the effort. I was brought in because I know the folks at Rishad Tabaccowala’s think-do tank Denou at Publicis. When they started, they wanted to involve bloggers and I insisted that the only was to do that was through advertising on the blogs; it’s a clear relationship and it also gives respect to the medium and its people (I’m happy to see that Bernoff liked this). I introduced them to Amanda (which thrilled them; it was as if I’d snagged Oprah). And I gave some advice on the videos (obvious stuff: put your best stuff first, make them short and fun). And I suggested Bright Cove for the serving and Federated Media as an ad network. And they bought lunch.

I’m glad that we’re seeing internet video and blogs and ad money come together. This is the kind of new thinking you can bring to life in these new media. I will leave it to you to say what you think of the program and the videos:

: LATER: Radar goes after Amanda for shilling while also reporting with ABC. Legit discussion. But it’s not a first; she is making a Dove commercial at Blip and she made commercials for first first sponsors on Rocketboom. There are a bunch of different issues besides the one Radar raises, including how small shops will handle the sponsorship they get (a la Rocketboom).

: LATER STILL: See Amanda’s blog:

ABC and HBO both approved the DuPont spots. And under the “blogger” title, which is what I am, hello? I am not subject to the “rules” traditional journalists have to follow.

Isn’t that what new media is all about? Breaking the rules? Setting our own? I see nothing wrong with doing commercials, which is what they, quite transparently, are. If DuPont had tried to pass them off as authentic, homegrown videos, yeah, then that would’ve been wrong (and, of course, I would never have agreed to the project if that was the plan). . . .

It’s also about acting.

: THURSDAY UPDATE: Here‘s an LA Times story about bloggers in ads out of this.

Newspapers’ industrial suicide

January 10, 2007 by Jeff Jarvis
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Three of the (still) big newspaper companies, Gannett, Tribune, McClatchy, announced a joint effort to sell national ads onto their web sites. Now you might think I’d nod approvingly at that. But I’m not. I’m shaking my head in sad disbelief. For this only reminds me of the newspaper industry’s horribly failed effort to sell ads across the sites of a dozen big companies, the New Century Network, which failed because the companies simply could not work together. And the Journal story only points out that there are still fragmented, competitive efforts going on in the industry. The bottom line is that they are making it hard for national advertisers to buy their sites — thus, easier to buy Yahoo, Google, MSN, MySpace, et al. You see, newspapers all think they’re special. But they’re not.