Tuesday, August 15, 2006

"Our main business is not to see what lies dimly at a distance, but to do what lies clearly at hand." Thomas Carlyle

Robert Cyran
says reaching the restless digital natives via media partnerships (e.g., Google & MySpace) might work but two problems remain...

First, new media switching costs are low -- all you have to do is click on a new link. And the fact that these sites are "social" necessarily implies that they are subject to the vagaries of fashion. Throw in unabating technological change, and these sites could have a short-shelf life.

Second, social sites have had a tough time converting eyeballs into cash. True, News Corp has extracted a large amount of cash from MySpace by directing associated search traffic through Google. It remains to be seen if Google can turn MySpace traffic into profits. If it can't, the odds of old media quelling the digital unrest look poor.
Cyran's commentary, Media companies losing control, via MarketWatch here

400 year death spiral continues: The dead tree guys have another reason for concern. Google is getting into the business of retail coupons via Google Maps. Using the same intuitiveness that led Microsoft Office Live to make the brilliant offer of free websites to small business owners, now Google offers merchants free coupons. What makes both the Office Live and Google offerings so attractive is a deep understanding of small business. Google's coupon initiative demonstrates a respect for the raw economic power of the coupon shopper and an acknowledgement; one of the strongest appeals of dead tree advertising is the tangible and merchants love tangible.

From today's WSJ...

Starting today, businesses that want to offer coupons will be able to go to the Local Business Center area of Maps -- the place where businesses can provide up-to-date information about themselves -- and enter information about their special offers and upload an image. The coupons can be printed out and then redeemed at stores, making them useful to small businesses that don't have online stores.

"It's completely free for the merchant and the user," said Gokul Rajaram, director of product management at Google. "Whatever the [sales] conversion rate, it's going to be a big win for the merchant."

Because their use is so easily tracked, the coupons could also help to convince small businesses that advertising online, including on Google Maps, is effective and worthwhile.

Google, like Microsoft, will create a market. What Microsoft and Google have done is nothing short of revolutionary, they have refused to accept the inviolability of the dead tree revenue engines. Moreover, like any good chess player, they are playing ahead of the game. Bravo and cheers to the Google gang, scary smart move! Riva Richmond provides an excellent overview in today's WSJ (sub req) here

Closed circuit to broadcast sales management: The lesson here is "Ambient Findability" Q.E.D., please see Peter Morville

Barry Diller makes another smooth move acquiring 51% of Connected Ventures LLC, owners of CollegeHumor.com. IAC/InterActive Corp already owns Ticketmaster, Ask.com, CitySearch, and Evite. Congrats to CV founders Josh Abramson and Ricky Van Veen who stay on as minority owners. Cheers to IAC's Michael Jackson. Diller & Jackson make a great team and IAC is the team to watch.