What are we doing about it?
Oh, yes: Squandaring billions in Iraq, Afghanistan, while the Chinese avoid wars and invest in their education and infrastructure.
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WatchMojo NewsletterI think Fortune’s writers have lost their marbles. Three weeks ago, on Halloween to be precise, a story was published by Fortune magazine (who, like AOL, is owned by Time Warner, to quote the venerable magazine) suggested a plethora of hail marries move connecting everyone from:
- AOL to Yahoo
- MSN to Yahoo
- Yahoo to eBay
- Middle Earth to Yahoo - all right, that one never came up.
We decided to throw out our two cents and say that this was unlikely because Google owned 5% of AOL and would probably block any deal, directly or indirectly. A few readers of the investment banking world sent in their two cents to me and suggested that our rationale was not all that incorrect, but that it was not impossible, either.
Today, 22 days after the initial article came out, Fortune.com changes the date and re-publishes the same article.
We once again doubt this makes sense logistically. Go through the phases and you will see that Google will effectively block this deal one way or another.
If anyone has arguments suggesting that our assessment is incorrect, by all means speak up!
Disclosure: I own shares in YHOO and have never been to Middle Earth…
I hate the Web 2.0 term, but it’s short and simple and fits in a title. There are so many things from the Web 1994-2001 that we are seeing now again. Heck, even All Advantage is back. May they rest in peace once again.
Marketwatch writes on how reporter poaching is unsettling old media; between blogs making publishing so seamless, and Ad Sense allowing a quick revenue stream (albeit miniscule), I guess this is the answer to Webvan recruiting George Shaheen from Accenture back in the day?
This interview was published Tuesday, November 16th. That’s last week. That’s before he re-acquired the non-MySpace assets of Intermix from News Corp.
In the Q&A, we learn that he’s raised $200M giving him a valuation of nearly $580M (what MySpace parent Intermix sold including MySpace).
What we do not know is how much News Corp. sold those non-MySpace Intermix assets… but assuming investors are not crazy, they must have known what the use of funds would be… no?
Bambi Francisco: Define what a new-media company is.Rosenblatt: A new-media company provides tools and technologies that allow for cost effective publishing and efficient distribution of content. Beginning in 1995, there was an emergence of new-media companies that went beyond traditional media companies by publishing their content in real time and having the flexibility to change it on the fly. MySpace led the next evolution by empowering users to publish their content in a mass way. Demand Media is continuing to expand on this content revolution by coupling user generated content with professional content and allow them to speak to enthusiasts in a given vertical. As such, their content is not only pushed to a broad audience, but a targeted and relevant group. As part of this strategy, they are also getting paid for their publishing efforts.B.F.: What’s so new media about a company that’s buying up niche content? Isn’t that what cable companies have? You’re just broadening out the niches?Rosenblatt: The difference is that we start with niche verticals but add a suite of proprietary new-media tools that transforms the vertical into a fast-growing, user-generated, focused, community vertical with unique, compelling and constantly refreshed content. The other main difference is that we are doing things much more efficiently than traditional media companies. We do not have the same cost structure or approach to producing content, getting distribution or selling advertising. We get content from our users for little to no cost, we leverage partners to sell our ads so we do not need our own ad sales force, and we get a significant amount of traffic from “direct navigation” through our portfolio of domain names.B.F.: You have $100 million to spend. What type of content companies are you seeking to buy? And how much do you want to spend on each property?Rosenblatt: We are looking at enthusiastic categories that pass a rigorous set of proprietary and confidential requirements. For example, we purchased ehow.com and have relaunched into beta www.wehow.com which demonstrates many of the new media principles we described earlier.B.F.: Why did you need to raise $200 million? That seems like a heck of a lot of money to build content on the Web, which doesn’t take that much to build these days.Rosenblatt: As I said at the Web 2.0. Summit, go big or go home! We think there is a great market opportunity to build the next-generation media platform by combining domains, niche content properties and unique tools and technologies. Size and scale matters, and the capital allows us to secure a market leadership position quickly.B.F.: There are many content companies emerging, with a user-generated component, what kind of user-generated content play would you stay away from, and what are you drawn to?Rosenblatt: We like all types of user generated content but we feel that (1) there is too much (2) it is not vetted enough and (3) it is not categorized well by vertical. Our goal is to provide users with the best tools to express themselves, allow them to easily search and find what they are looking for based on the vertical they are interested in, and allow them to get to the most relevant content based on its quality as determined by other users. We like user generated content that allows users to express themselves and showcase their personality. We like to focus on things that creating user generated content that has lasting value.B.F.: Are you interested in video UG [user-generated] content companies? If so, what are you looking for? If not, why not?Rosensblatt: We are interested in video content as one way that users express themselves. We have an announcement coming soon that will show how we are uniquely addressing this market.B.F.: Why don’t you like the wiki model? Explain why you won’t let people edit others in the eHow/weHow service. (Maybe I misunderstood you at the conference. If so, just please explain your views on wikis.)Rosenblatt: I do like the wiki model as one component of providing users information. We think it needs to be combined with professional/expert content and individuals self-publishing without the ability for the community to change. By combining all three, the viewer can get three perspectives on the topic they are trying to get information on.B.F.: What did you learn from MySpace about how to make online properties a hit, and how are you applying that to Demand Media.Rosenblatt: Give the users the right tools and technologies combined with the right incentives to publish and they will do the hard work for you. Understand and focus on the user. Launch features fast and often. Always listen to users and solicit their feedback.B.F.: Do you have plans to work with MySpace as a distributor of your content?Rosenblatt: Yes, my relationship with MySpace continues to be strong, and I hope to work with them as well as a number of other traditional and new media companies.B.F.: Will MySpace have problems drilling down into niches?Rosenblatt: I am not privy to their specific plans but they are a very smart and capable group and it will depend on where they decide to focus.
John Shinal looks back at the similarities between Cisco circa 2000 and google today, Bambi Francisco asks how high it will go, we ask if google will be the world’s first trillion dollar market cap company.
Now that AOL has turned the corner and looks to be a crown jewel in Time Warner, the purge of AOL managers continues as a “TW vet” becomes president of the online unit. This comes on the heel of Jon Miller being fired by AOL and replaced by NBC’s Randy Falco, who is a seasoned “ad man.”
I am sure Ron Grant is a genleman and a scholar, but just a couple of years ago, Time Warner could not pay someone to take off the unit off their hands and no Time Warner executives would have been caught dead considering a post at the online unit, today, not so.
Not to be a smart ass, but Time Warner might want to find a Tech editor from one of Time and put them in charge of Netscape.
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Right off the bat I will say that no, social news is not a dying fad. I will say however that the model so far employed by Digg and borrowed by Netscape is not going to win in the long term.
I’ve been checking Jason’s website hoping to read some interesting tidbits on what a successful entrepreneur does in between ventures, apparently, watching basketball highlights (that was a helluva block), rappers, hit back at his naysayers and offer his two cents on social media, the field he was at least up to last week, competing in.
His conclusion is that:
[There] really isn’t a “problem” since folks understand that these system can get gamed. Just like folks know that on a life TV report someone could jump in front of the camera and yell something–but you know that doesn’t replace the anchor even though they have for five seconds.
Anyone in media can–and will–get spoofed: The New York Times, Engadget, digg, Netscape, or CNN. It’s how you deal with the spoofing and the intelligence of your users that matter. In another year folks will learn to say “it was on a social news site, but I *checked* the comments and it doesn’t seem real.” Or, “I checked CNN and Google News and they had nothing on it.” In other words, folks will take responsibility for what they read.
That’s a fair conclusion, but the problem (if we can call it that) is that we forget that things exist and operate for a reason over hundreds of years… yet, every once in a while, someone comes up with a twist and we think that things like Digg are going to totally reinvent the business of publishing news. It just won’t. If anything, it will force the establishment to change, but there are very radical changes in business, mainly linear ones. Even the most successful case study of a new business changing the game: Google, was not different at all. It was in fact more of, or rather, only “the same” when it decided to focus on search while Altavista saw Yahoo! and suffered from portal envy, leaving the door open for Google.
This is why it was smart for Condenet to acquire Reddit and conversely wise for Reddit to sell to Condenet, instead of chasing a pipe dream of “firing every editor out there and changing the rules of the game,” Reddit will get to use their tech savvy and new media insight into managing content that is a part of their new employer instead of trying to keep unpaid social bookmarkers motivated, advertisers interested, readers engaged and fraudsters away. Either one of those things would be hard, doing all four will be nearly impossible.
Digg was being courted by News Corp., it asked for $150M. A hundred and fifty million dollars. For what? And I like Digg and respect what its founders have done… but with Ross Levinsohn leaving FIM and News Corp. selling Intermix’s non Myspace assets to the old CEO of Intermix… clearly the days of major online acquisitions from News Corp. are over (we could be wrong, of course). Google and Yahoo! are always would-be buyers, but Yahoo! should have simply better leveraged Del.ici.ous instead of, well, whatever it did with it. Google will always be interested but let’s face it, after forking over $1.65 billion for YouTube, it could simply leverage YouTube’s tagging platform, mesh it into Google News and do something with that… since Google News, as great as it is, needs something to add spice to it.
There, just gave you an idea Google. Not the first time.
My half penny.
Yesterday, Gawker Media’s Nick Denton took a jab (our comments) at Jason Calacanis’ resignation from Netscape, today, Jason strikes back. What strikes me as very odd is that here are two guys who should be fighting to boost credibility to the sub-media of blogging, and not trying to make one another look like phonies, no? And no, we don’t mean phony in that Seinfeld-esque way… (though don’t all Seinfeld references seem more phony less funny since Michael Richards’ contribution to the Hall of Shame of Comedy?)
When I was thinking of how to launch a blog network early this year, I thought both men had done a fantastic job in launching and scaling a successful blog network. I will be the first to admit that I sought to both emulate and avoid things they had done with their respective businesses. While Calacanis went on to sell his empire to AOL for a reported $25M, Denton has not, though he has always stated - at least in public - that Gawker was unsellable due to the nature of content on Fleshbot, Gawker, Valleywag etc. That could simply be PR.
All to say, if an outsider ventured to their sites to learm more about blogs in general and saw the mudslinging, it would, with all due respect, speak volumes about both the level of experience and maturity of the business and people behind it.
There’s a big enough pie out there, make the pie bigger, don’t try to swipe the other guy’s morsels.
Google claims that AdSense reaches 76% of all U.S. Internet users. This is very impressive if it’s true, since Google has 44% market share on its property, 50% when you add on the search sites it powers. With Ad Sense, which is plastered on so many pages (and unlike Yahoo!, which does not have an automated service, by the way), it reaches 76% of US users.
Taken from Fortune.
I own shares in Yahoo!, cause I rather own Y! at $36B than G at $150B… hopefully I won’t be saying I rather own Y! at $25B and G at $200B… but I digress.
It was giving in to the sins that made us suffer the first time around. Apparently, they’re back.
May god have mercy on their souls.
