Archive for the ‘strategy’ Category

TechCrunch’s REAL Valuation

Wednesday, October 3rd, 2007

TechCrunch logoThere has been a huge fuss about TechCrunch’s valuation and a possible buy-out from CNET. A $100 million price tag has been tossed around and Arrington has joked about the whole situation. Rumours and possible acquisitors aside, let’s explore a deeper issue - the valuation. Digging even deeper, let’s take a look at how a blog (in particular) should be valued. Surprisingly enough, I’m not even going to use numbers.

Where does the true value of a blog come from? The content. Where does the content come from? The publisher. In the case of a multi-author blog, the true value is traced back to the original publisher. So what am I trying to say? A blog is worthless without the original publisher. Or, in this case, TechCrunch is worthless without Mike Arrington. You can strap a $100 million or $500 million price tag on the blog, but all goodwill is lost when the Arrington leaves. I think this is true for any blog. The user base is built around the style and perspective of the creator. All subsequent authors can try to mimick the original style, but it truly cannot be copied.

If CNET does buy TechCrunch, I doubt Arrington will be around for long. My guess is that he’s looking to pursue more exciting and captivating opportunities. If this does happen, what’s the outcome? Well, CNET will have bought the most expensive content management system in history.

NOTE: This post wasn’t meant to put down any of the other publishers or authors of TechCrunch. In fact, I have quite enjoyed most of their work. All I am illustrating is the need for the creator.

The Problem With The New Yahoo Search

Tuesday, October 2nd, 2007

Yahoo logoToday, Yahoo added new search features and functionality. Video embedding (via Yahoo Video, YouTube, and MetaCafe), Flickr integration, event information (via, and new Yahoo Shortcuts were all introduced. We’re seeing all this wonderful social media integration - so what’s the big problem? It’s biased. And search engines shouldn’t be biased.

To be honest, I’m genuinely upset about the changes. Not only do they add more clutter to the page, but they’re decreasing the overall quality and relevancy of the search engine. Furthermore, Yahoo is getting praise for these changes. Many are even saying that the company is catching up to Google. I even heard a whisper of the term “Google killer”. This is a bold statement and it can’t be farther from the truth. In reality, Yahoo is widening the gap. They are drifting further away from Google, as they are providing less relevant, more biased results. They are redefining ‘vertical creep’. On the occasion, Yahoo will have the most relevant result on the entire net, but more often than that, it won’t. What Yahoo needs to do is go back to the drawing board and work on their algorithm. This is the bread and butter of any search engine. Forget the web 2.0 app integration.

Pardon my rant, but I’m not a big fan of this move. It is company bias in a space where there should be no bias. All this new integration means that a given user will (in most cases) not be receiving the best quality, unedited, clean, no-strings-attached results. Rather, they are subjected to ’Yahoo’ results and links to Yahoo properties. In my opinion, this leads to higher short-term benefits (and revenues) for the company due to an increase in page views, but translates to long-term problems in the areas of relevancy and perception.

If Yahoo does want to include such results in search, place this information in the sidebar and provide disclosure around it. Numerous others have done it in the past, so why not Yahoo? By integrating company results into the natural search results, it confuses and/or deceives the user. This isn’t in the best interest of the company - at least in my mind. Another possible solution is richer functionality in the ‘vertical search tabs’. If I really want images or videos in my results, I search via Yahoo Image search or Yahoo Video search, not regular search. I think there is an opportunity here, but Yahoo is being greedy.

I say, “Just gimme the best damn results.” Google does a pretty darn good job of this. They haven’t cluttered the results or riddled the page with endless amounts of company-centric material.

One bright spot for Yahoo is Search Assist. This new tool (somewhat akin to Google Suggest) provides contextual suggestions and conceptual recommendations for your search queries. This saves time and hassle, and may indeed aide you in reaching the most relevant results. So why do I like this? As opposed to the other Yahoo features, this one is unbiased (at least I HOPE). It is based on user behaviour, patterns, and trends.

Below is a screenshot of Yahoo Assist (courtesy of Search Engine Journal):

In the end, I think what Yahoo is trying to do is capitalize on all their recent web 2.0 acquisitions by integrating them into search. I think it’s a valiant idea, but involved poor execution. As I mentioned before, I don’t think that integrating such results into the natural search results is the optimal strategy. Company bias and and self-fulfilling intentions start to play a role, and all of a sudden, people are starting to question the credibility and trustworthiness of search. Losing trust is probably the worst possible outcome for Yahoo at this point in the game.

Is BlogRush The Most Viral Start-Up Ever?

Thursday, September 27th, 2007

BlogRush logoIt’s been less than two weeks since launch and already BlogRush has vaulted into the Alexa top 1,000 (weekly average). It takes most start-ups, even the most viral, a year or two to crack this barrier, but BlogRush has managed to do it in less than half a month. This must mean something. This company is for REAL. This surge makes Twitter’s success look like a lifetime achievement.

So what is BlogRush? What’s all the fuss about?

To be honest, it’s a very simple concept. That’s why it works. People understand it and can see the value. The basic premise is this: you paste an embed code onto your blog. BlogRush displays a widget with the titles of 5 blog posts from blogs similar to yours. In other words, for every page loaded, 5 other blogs are gaining potential exposure and awareness via your site. In return for every page load your blog creates, one of your headlines appears on BlogRush widget on a different blog that is similar to yours. This ensures that nobody gets ripped off or cheated.

Now here’s the kicker: for every person that you refer to BlogRush (or that signs up below you), you will receive an additional headline view for every one of your referral’s page views. This works 10 levels down. So basically, the more people you get to sign up, the more traffic you can generate for your blog. Very smart concept. In essence, this idea is very similar to many web 1.0 concepts around traffic-sharing. However, I prefer to think of this idea as the ‘link exchange of the web 2.0 world’, as it harnesses the power of widgets.

Finally, is there a revenue model? Most widgets have a hard time implementing any sort of monetization. But I think BlogRush is different. Think of this… for any and all leftover inventory, BlogRush can sell the space to potential advertisers, looking to access relevant content and blogs. Furthermore, they may even be able to add network ads to fill in the holes.

Who knows… I may soon have to ‘rush’ out and add this widget. And perhaps you may want to sign up below me? ;)

What do you think? Is BlogRush the most viral start-up we’ve seen thus far?

Facebook IM Client Coming Soon - Like, This Friday

Wednesday, September 26th, 2007

Facebook new logoAccording to Blognation UK, an unofficial Facebook IM app will be going into BETA this Friday. Emphasis is being placed on the fact that no registration, installation, or download is needed to use the chat program. All Facebook users can instantly access the system. Although this application (Friendvox) is not a company-owned property, it will likely provide any and all functionality that an in-house system would. In other words, this app may be a prime takeover target for Facebook if they aren’t already developing a client of their own.

To be honest, I think we all knew that it was only a matter of time before a Facebook IM client came to fruition. I guess that time is now. Whether it provides any level of competition against MSN Messenger, AIM, Yahoo Messenger, and/or Google Talk is yet to be determined.

Here are some screenshots of the new IM (courtesy of Blognation UK): 

I wasn’t overly impressed by the chat interface - I thought it was rather ugly when compared to the rest of Facebook. The traditional clean look has been replaced by a web 1.0 feel. Then again though, the system was not created by Facebook itself.

It will be interested to see what the company’s next step is in the space. It will also be interested to see what other applications and spaces the company plans to enter in the coming months. If I were any kind of social app, I’d be scared to death if there was a chance Facebook might enter my realm. These companies will need to erect barriers quickly if they planning on surviving the initial Facebook tsunami.

Microsoft Wants A Piece of Facebook?

Tuesday, September 25th, 2007

Facebook new logoOnce again, Facebook rumours are all the talk in the blogosphere. The newest gossip, courtesy of the Wall Street Journal, states that Microsoft is in talks to buy a 5% stake in Facebook for a reported $300-500 million. But the plot thickens… The article goes on to say that Google may also be interested in buying a stake of its own, further upping the ante.

Surprisingly, we’re not hearing about any full-blown acquisition rumours anymore. Why not? No-one can afford the damn company anymore. Apparently, Microsoft is pegging the social network at a current valuation of $10 billion. Are you kidding me? The company is only slated to pull in $150 million in revenues this year. Now, I’m not a financial analyst, but I can tell you that such an amount is rather ridiculous based on historical valuation methods. Furthermore, previous acquisition talks this year started at $1 billion and escalated to a seemingly preposturous $6 billion.

And get this… Facebook may be turning down the high profile deal in hopes of attaining a $15 billion valuation. Yes, you heard me right. The bubble may be closer than we think. Either that or Zuckerberg’s ego has ballooned to Donald Trump-like proportions.