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Archives: January 2003
Making waves in an ocean of entropy
The Internet has outstripped TV and newspapers as an information source, says a new survey. At the same time, people believe less of what they read online and therefore have to do more cross-cking of information.
There's a glut of ad slots and ads, news and news peddlers. In fact, thanks to the likes of CraigsList and Slashdot and what Clay Shirky labels the "mass amateurization of publishing," both could be virtually infinite.
Traditional ad-funded media may soon be swamped in the ever-expanding info universe sparked by the Internet Big Bang. But this spreading ad and info entropy will also challenge advertisers; traditional demographic-based advertising will soon be as effective as trying to heat the moon with a blow drier.
Against this backdrop, I've argued that "hubness" (like hipness, but more businessy) will be the thing that differentiates blogs from other media and gives hub bloggers premium CPMs. The best blog ads will be like the billboards on Times Square -- more expensive in terms of eyeballs, but good value for signalling to customers, competitors and business partners that "we're serious."
These blogad buyers will be the types of buzz-seeking, network-aspiring companies -- software vendors, media producers, fashion peddlers, auctioneers, artists, and service providers -- who traditionally promote themselves through what economists refer to as "common knowledge events," the socially intertwined spectacles, forums and media within which participants can look at each other and say "you know I know you are watching."
Granted, bloggers will have to cultivate and then publicize any claim to hubdom in their respective niches. (And yes, at present, few bloggers even have defined a niche beyond "what interests me today." That's not a bad niche, but obviously won't cut it commercially.)
Can the blog compete commercially in the age of media entropy? As commercial organisms, blogs have short life-cycles, small metabolisms and are run by flexible egos. Up against the old, thick-shell, high-burn, multi-cell media organisms, the blog is an ideal candidate to evolve and exploit the new environment.
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Blogads: 'a strip mall run by maniacs'
Two posts of interest for Blogads users this morning. In the Guardian, Jim McClellan surveys the prospects for commercial blogging and features Blogads. From the grassroots, Ken Layne blogs: "My BlogAds make me happy. Currently, this site is offering a gun T-shirt, an Arizona politics blog, corsets, trial subscriptions to the Los Angeles Examiner paper, and a link to an L.A. news-gossip site. It's a strip mall run by maniacs."
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Infectious blogging...
I was on a blogging panel Monday afternoon at DCdotcom, an event for DC ad execs. The day was well-run and kept the 220 attendees entertained/informed.
There was a lot of interest about blogging, but only 10% of the audience had ever read a blog and only 2% had actually blogged. Wake up ladies and gentlemen! Dave Barry has a blog. GWB reads blogs.
I had the pleasure of meeting Meg Hourihan in person, but am afraid I borrowed her stomach bug. Jennifer, did you fare any better?
Hmm... blogging seems to be something you can only catch in person too. Let's see if more DC ad folks catch the blog flu.
A Washington Post ad VP gave us his spiel. He emphaized some good stats -- the web is number 1 news source for business decision makers, number 1 media during work.
My favorite line was this classic pitch: "some of our clients don't want us to tell people how well they are doing with their online advertising -- they don't want their competitors to find out." I liked this line because a) it is funny to hear someone from the Post resort to this genre of aluminum-siding-sales-training-school "trust me" pitch. And b) although the pitch was dripping oil, it was a good point and probably true. The neat thing about the web is that your competition can be TOTALLY ignorant about how well you are doing. There are no parking lots to check, no shelves to watch.
Of course, this can also pose a problem because people like to deal with companies that are successful... and e-businesses are still working on ways to reflect "popular" or "busy" or "buzzing" online.
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Deflation articles: Whoppers and meltdown
You know I like to beat the claxon about deflation. For some good anecdotes about the phenomena, see David Leonhard's story; among other things, he notes that the price of Burger King's Whopper has declined by a third in the last twenty years. And if you want to look under deflation's hood, don't miss Megan McArdle's explanation of the pernicious economics of deflation. In short, "the mechanism for generating money starts to break down."
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CraigsList, Blogads and GE
The NYTimes profiles CraigsList, the famed free classifieds site started in San Fransisco in 1995. The only revenues come from job listings for SF, but now suffice to cover costs including 14 staffers.
CraigsList is doing 200 million page impressions a month in SF alone, according to the article. What the article doesn't highlight is that this traffic (in what some New Yorkers would consider a backwater media market) is not far below that of America's top news site -- yes, NYTimes.com -- which is running around 300 million page views a month. Ahh, context.
Wonder what the CraigsList's monthly page views look like across its dozen markets? Here's a graph of the growth of NY apartment listings. Looks exponential to me.
As CraigsList chews the belly out of newspapers' core market, where does Blogads fit into the new media ecosystem? I'd say that "hubness" (like hipness, but more business) will be the thing that differentiates blogs from other media and gives hub bloggers premium CPMs. These blogs will be key venues for those advertisers who not only want clicks or branding, but who want to be seen to be "at the center." So good blog ads will be like the billboards on Times Square -- more expensive in terms of eyeballs, but good value for telling competitors, business partners and customers "we're serious."
Fading industrial powerhouse GE won't run any of its newly bought 500 million Imagination ad impressions on blogs, but the entrepreneurs who are tomorrow's megabusinesses -- e-book publishers, software programmers, gadget vendors, eBay traders, e-commerce gurus -- will understand the unique value of advertising where ideas happen, rather than where they get reported.
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Young media versus old monopolies
Why is the UK press so much spicier than the American? Former FT scribe and new New York news monger Nick Denton offers a good guess.
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Blogads developments
Some work for a big publishing client and a necessary but arduous software/hardware upgrade put us into hibernation for the last six weeks. Now we're back! We've just created a CSS adstrip, which simplifies design customization from the blogger's side. Today, we've also revived optional comments on ads, something we experimented with a few month ago. Comments are working well on sites like Fark and Kuro5hin and should exponentiate clickthrus on ads for artistic works. (Although some artists won't like everything that gets said about their work!) You can see the CSS adstrip at right and use the comments feature on the Blogcritics ad.
Also, we've just reorganized the order page to a) give priority to bigger sites and b) make it easier for advertisers to comparison shop. (The page view estimate come from the number of times each adstrip is served from our server.) If you want to support great bloggers, please feel free to link into the page. Here's that URL again -- http://www.blogads.com/order_html -- so you can copy/paste right now.
One marketing-savvy blogger, Olivier Travers at Scifan, now nets an incredible average of $20 per CPM on his Blogads. This blows even leading publishers like the WSJ.com out of the water, especially since Olivier doesn't have to underwrite the ad salespeople, Oracle DBAs, Vignette licenses, copy editors and lackeys who bleed "real" new media operations. How much does Olivier sweat to sell ads? He mentions the ads to every author and PR person who contacts him. The rest of the time he focuses on dominating his niche.
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The Layne diet for Salon...
Doing some free consulting for one-time high-flying Internet magazine Salon, Ken Layne suggests cutting the staff of 50 to 8. "Get out of that ritzy office space -- two floors? -- and take 1,500 square feet above a bar in Chinatown. Hold meetings at the bar." I remember visiting Ken in the dingy offices of his protoblog Tabloid back in... 1998 was it? Salon would be rolling in dough (and Dow?) if it had copied that strategy.
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"Sit Down diner mystery deepens"
My daughter and her friends are abuzz with news that the owner of a spiffy local diner has vanished. They are doing Google searches and hypothesizing about his possible whereabouts. The owner didn't tell anyone he was shutting down, changed his cell-phone number, stopped ordering food and then didn't return from one week being "closed for repairs." The whole thing is right out of Nancy Drew.
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Blue light blackout
E&P reports: "David Keyes was just about to turn in his 2003 annual budget last week for the Bonner County Daily Bee, a 4,701-daily-circulation newspaper in Sandpoint, Idaho, when his secretary slipped him a message that made him blanch: Sandpoint's Kmart was among the 326 stores chosen to close as part of the retailer's plan to exit bankruptcy. Since it opened in 1990, the Sandpoint store has come to be the Daily Bee's fifth-largest advertiser, accounting for about 8% of the Hagadone Corp. paper's ad revenue." As the tides shift, so shift the sands we build on.
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Traffic does grow on trees...
Nick Denton notes that gadget blog Gizmodo is now pulling 50,000+ page views a week, just five months after launch. Marketing consisted of "an email to a few webloggers and reporters." In addition to NY-gossip blog Gawker, Nick is looking to launch an "erotic blog." With New York, tech and sex covered, has Nick exhausted the genre? Naw, I think 10,000 angles can dance from this pixel.
(That was my attempt to play off the phrase "angels dancing on the head of a pin"... I didn't succeed, did I?)
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Bowling, Dot.con, LA weekly
I escorted my son to Diego's bowling birthday party yesterday. The ten kids loved it. I haven't been in a bowling alley since 1991. In a stroke a genius, the bowling industry has added kid-friendly gutter guards that steer the ball out of the gutter and into the pins. In this gutterless world, velocity wins: the high scorers (avg 72) threw a little harder than the laggards (avg 65) and also finished earlier.
I also finished Ken Layne's Dot.con this weekend. Layne has concocted a unique cocktail of Ian Fleming's suave and bruised hero, John Kennedy Toole's conspiring idiots and Evelyn Waugh's disgust for mediocre sycophantic journalists. The roast of San Fran culture also excels.
Unfortunately, you'll have to wait to read the book in e-book format, since Ken is all sold out and US publishers haven't bitten. As I said the other day -- why hasn't this been made into a movie? Yes, the book probably is mistaken as "another dot.com bubble" book. Too few publishers understand that Jesus Ramirez is the future of journalism and not a confused millennial blip. It also may be that Ken's book will get "rediscovered" in ten years. Books like The Sun Also Rises and The Great Gatsby that were published ten years after the era they chronicle a) look like the result of lots of hard work and b) benefit from mild nostalgia.
Speaking of secret agents, now the LA newpaper plot is public!
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Expat bloggers, etc...
Steve Carlson has posted an interview with yours truly on his new Digital Entrepreneur site. My favorite question was about post-expat bloggers. I argue: "So perhaps the meta characteristic for great bloggers is 'outsiderness.' Because they don't have big career or conceptual investments in the status quo, outsiders can better imagine trajectories in blogging. And because they are outsiders, they've got a grudge and are more motivated to put blogging's unique features to revolutionary use."
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Ready for Potter
Having read the Harry Potter books three times now (once myself, once to each of our kids), I'm glad to hear that the Order of the Pheonix will finally be out in June. Some coverage, incredibly, doesn't include this excerpt: "Dumbledore lowered his hands and surveyed Harry through his half-moon glasses. 'It is time,' he said, 'for me to tell you what I should have told you five years ago, Harry. Please sit down. I am going to tell you everything.'"
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Raise taxes or 'your neighbor gets laid off'
Massachuessetts, like a lot of states, is running a nasty budget deficit as tax revenues decline from the roaring nineties. The projected shortfall for next year is $3 billion. In November, voters nearly passed a resolution killing the state's 5.8% income tax, so raising taxes doesn't appear to be an option.
Unfortunately, state and local officials don't make a very compelling case for their services as they argue against budget cuts. They talk vaguely about "horrible scenarios," but we get very little concrete argument. An article in yesterday's local paper, the Hampshire Gazette, offers a case in point.
"Area officials said they believe the general public does not realize the full implications of the cuts to come, and that some people would not be so opposed to a tax increase if they did. 'It's hard for me to understand why we can't make an argument to support a moderate increase in the income tax, because the alternative is your neighbor gets laid off,' said Robin Crosbie, administrator for Hadley." Ahh, so that's why we pay taxes.
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Deflation accelerates...
Core prices for businesses fell 0.4% last year, with a particular sag in the fourth quarter, reports CNN. "Excluding volatile food and energy prices, 'core' PPI fell 0.3 percent [in December] after falling a revised 0.3 percent in November."
To beat my old drum: Pop historians usually start a new decade a few years after the calendar. If The Sixties started in 1963 with the Beatles and the Pill, will the 00s open in 2003 with closed wallets and free 64 MB memory cards? If the nineties roared like the twenties, will the 00s now sink, tumble, flounder, flush and drizzle like the thirties? If so, nothing but cash will be worth more tomorrow.
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Reportage a la Gawker
Elizabeth Spiers does a mirror-true interview with a coke buyer about her dream of "the perfect dealer." Blog reportage at its best.
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Bang a gong
We went to a friend's house last night for pizza. In her studio, there were nine 15-30 inch Piaste gongs she'd been given after hanging out a decade ago at the factory in Germany. I've always thought of gongs as things that go "boom" or "bong." Turns out that if you mallet a good big gong repeatedly, a series of harmonic permutations emerge. It's a kind of layer cake of sound; it's like you are peeling peals off an orchestral onion. I swear that her big gong gave a twenty second French horn tone and later produced a clear trumpet peal and then a flute... all while roaring and groaning and sizzling and screaming. I'll add a big Piaste gong to my "list of things to splurge on if I ever win the lottery."
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The too trite Two Towers
Am I the only person who saw the Two Towers without first seeing the Fellowship of the Ring? (I was marooned in France, and babysitters were expensive and... )
Gee, I was appalled by TT. I was a bonefide Tolkeinite in my teens but have to say that TT, seen in a vacuum, was trite, juvenile and plastic. I've seen more believable characters and gripping action in a dubbed Godzilla movie.
So I rented Fellowship of the Ring on video and saw where TT was coming from. But let this be said, oh mortal moviegoers, the second act does not hold water on its own.
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Capital gains taxes to shrink too?
While everyone focuses on the elimination of the dividend tax, it seems that capital gains taxes will also fall under Bush's plan. The WSJ explains: "Say a share is bought for $100 and the company has $6.50 a share in fully taxed profits that year. The company will notify the shareholder of this. Then, suppose the share is sold for $110, for a $10 profit. The capital-gains tax will apply only to $3.50 of the gains ($10 minus $6.50.) Each year, a holder will be able to increase his "basis" -- the cost for figuring out his gain on shares held, for tax purposes -- by the amount of the company's taxed profits." This will be a bookkeeping nightmare for shareholders, but I guess their pain will be well compensated.
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Scalzi: from pixels to print... to orbit
Patrick Nielsen Hayden, an editor at scifi publisher Tor Books and a blogger, has bought rights to publish a new book by John Scalzi, a consultant and blogger. Patrick read the book, called "Agent to the Stars" on John's site.
Asked whether this "already published" status could hurt the book's sales, Patrick comments: "What it seems to me that we're learning about online free (or cheap) distribution of fiction e-texts is that, sometimes at least, it doesn't hurt the sale of print editions and may even help it. Data points: Scott Card giving away e-texts on his website. Baen Books' various promotions and sales of e-texts. The latest David Weber hardcover extravaganza included a CD-ROM bound into the back cover, containing e-texts of all the previous books in the series. I will bet you lunch that this caused the sale of more David Weber backlist print editions than it cost. With fiction, at any rate, people mostly don't say 'I don't need a printed book, I have an e-text.' I'm sure some do. But mostly they say "I'm intrigued by the taste I got from this e-text, so I'm going to go buy a more-comfortable-to-read printed book now. But you know something? Maybe I'm wrong. Maybe all this is just an artifact of a temporary 'comfort gap' between e-texts and printed books. Maybe ten years from now it will be all different. Maybe aspiring writers should be entirely wary of letting their prose onto the net. What I know is that I liked Scalzi's book and, in the two minutes I spent considering the fact that it had 'already been published' on the Web, my basic conclusion was 'so what.' Right now, in his case at least, this seems not so much a bug as a feature. Applicability to other cases? Unknown."
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The "dream paper"
The Columbia Journalism Review asks 13 teams of young journalists to imagine their dream newspaper. Seems they want blogs, but just don't know it.
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eBay health insurance
eBay has launched its program offering health insurance to its elite sellers and their families. As the Internet continues to both atomize traditional corporations and empower new classes of entrepreneurs, we will see more programs that deliver corporate-style benefits to affiliated individuals. Yes, that means I would love to see Blogads health insurance some day. (I found this on auction news site Auctionbytes, which is itself a brilliant example of Internet publishing entrepreneurship.)
As many as 115,000 people sell more than $1,000 a month on eBay and could qualify as Powersellers, says Ina Steiner, editor or Auctionbytes.
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Democratic blogging network?
As some Democrats ponder erecting a cable network to get out their message, Greg Beato comments "the conservatives didn't succeed by bankrolling me-too entries into established media; they succeeded by pioneering new forms, i.e. talk-radio and partisan cable news. The new medium now, of course, is the Internet. And the new form is the blog. So instead of scoffing at 'obscure Internet Web sites,' why not support them?" He suggests the Democrats fund 200 bloggers. This democratic approach would no doubt go against the grain, but "giving up control of the medium is probably your best shot at regaining control of the message," says Greg.
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Yesterday... sung next week
Working on a secret print project, Ken Layne is reminded that the jig is up for print...: "I've taken to singing a variation of "Yesterday" when reading the L.A. Times: 'Yesterday, all these stories were already played, now they seem so old and oh so lame, oh I read this crap yesterday.' Try working on a weekly. Jesus, what's the point? Well, the point is to Add Value, the way The Economist or Weekly Standard or NYT Week in Review adds value: get a bunch of good writers and let them make sense of it all. Even then, it's too late. Today's Week in Review missed some pretty obvious stuff, because the articles were finished on Wednesday or Thursday and edited early Friday."
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Vlog reviews
Yesterday I watched three of Jeff Jarvis' "vlogs," his self-produced videos of himself committing punditry.
I was skeptical. Though I know Jeff is charming in person and persuasive in text, I wasn't excited about sitting through three self-edited minutes of punditizing. Since video isn't easily scanned and sifted like text, I thought I'd quickly run out of patience waiting for his bon mots.
I was wrong. First, Jeff delivered a steady stream high quality ideas and amusement. If anything, I was sorry he didn't deliver more slowly so I could transcribe some of his points. (Then I realized Jeff posted a transcript.) Second, the reward of additional information -- expression, cadence, tone -- more than compensated my inability to fast-forward or click on links. I was reminded (yet again) why meatings achieve so much more than phone, IM or e-mail.
For bloggers looking to convince or cajole, vlogs will be an essential tool.
I watched three vlogs. I'd give "Year-end media cliches" 2 stars for tone and content. "Christmas 2002" gets 4 stars for content and 3 stars for tone (the graphics distracted.) My favorite was "Fast food fades," which was full of swiftly delivered, tasty nuggets of fact and opinion. Jeff rightly concludes, "The problem may not be that the burger culture is fading... It may be that the Boomer culture is fading." Ten stars!
(Two quibbles: like their blog cousins, all vlogs should be dated and need separate URLs.)
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