Archive for the ‘strategy’ Category

Say Aloha to Mahalo

Wednesday, June 6th, 2007

Mahalo logoLast week, Jason Calcanis launched his pet project, a human-powered search called Mahalo. The engine provides company-edited results, as well as user-submitted results.

A typical search results page is comprised of several new areas:

  • The Mahalo Top 7 - seven hand-picked results from the editors
  • Guide Note - additional information and other relevant search queries
  • Fast Facts - self-explanatory

A given SERP also gives users the ability to add relevant links and results for that given query. Finally, a discussion area is available for every query. This allows users to provide further thoughts, above and beyond the search results.

Some quick facts about Mahalo:

  • 40 full-time editors
  • 4,000 results pages created thus far
  • 10,000 pages predicted by the end of 2007
  • 25,000 pages predicted by the end of 2008
  • 4 years - how long Calcanis says he can run the business without revenues

Once again, the scenario of ‘human vs. computer’ arises. Will Mahalo be able to provide better, more relevant results on an ongoing, frequent basis? My guess is no. I do not believe that a small team of editors can keep up to the constantly-expanding, dynamic nature of the web.

I am eager to see the offering put forth by Wikipedia founder Jimmy Wales. He is working on a human-powered search engine of his own. Apparently, these tech industry veterans believe that they can overcome the speed and power of the algorithm-based engines. I am full of doubts. And until they can provide me wrong, I think I will favour the algorithm-based players (especially for long tail queries ;) ).

Wednesday was Acquisition Day

Thursday, May 31st, 2007

Yesterday proved to be a big day in the web 2.0 world, as two of the biggest names were scooped up by two of the Internet’s heavyweights. Here is a recap of the day’s events:

It will be interesting to see what CBS and eBay planned to do with their new purchases and/or how they plan to integrate them with currents services.

I have to yet to grasp a good understanding of how these takeovers play a role in the grand scheme of things for both companies, but my mind is churning through the possibilities. In any case, there is always the potential to simply let the service or site live on its own. This model is more from an ‘investment’ approach for the company with the prospect of generating revenue in the future via the external, mutually-exclusive property. Another possibility is the re-sale of the site/service to a willing party at a later date for a greater dollar value, creating a reasonable ROI.

My hope is that the brand power and ‘corporate’ atmosphere of these giants don’t disrupt and ruin the communities built by these web 2.0 gems. Their tight cultures are what make them so special. Destroying those synergies would, in essence, destroy their very nature and DNA. Brings Vertical Search to the Tutor Industry

Wednesday, May 30th, 2007 hopes to simplify the process of finding a tutor. The service is tailored for both students and parents. The site claims to have a directory of over 9,000 tutors, who pay nothing to post their profile. For this reason, I believe that the revenue model can be summed up in two words: Google Adwords.

Each search query comprises two elements - the subject and region. Examples include:

  • Math - Phoenix, Arizona
  • Biology - Dallas
  • Literature - 08647

The interface and layout are fairly clean, intuitive, and easy-to-use. The company logo could use some work, but the concept is strong.

Setting Tutorz aside for a second, the notions of ‘local’ and ‘vertical search’ work together in a very relevant, pertinent manner. I expect to see more of this in the near future. ZipLocal is a very good Canadian example of this.

Vertical search is extremely similar to specialized directories, if you can imagine that for a second. The only difference is the method of discovery for the user. In one case, the user browses for a particular product or service. In the other case, a search is performed. In other words, vertical search isn’t entirely re-inventing the wheel, but perhaps making it easier and saving time for the user. 

Everyone’s Web 2.0 Revenue Model

Monday, May 28th, 2007

The buzz and hype of the new web landscape has subsided considerably. Yet, to my surprise, more and more ‘web 2.0′ start-ups continue to operate with the cheesiest, most over-used strategies.

  • “We’re currently in stealth mode.”
  • “Our AJAX widget will VOIP the RSS while podcasting to bloggers in a wiki-like fashion.”
  • Our target market is anyone who uses the Internet.”

These crack me up. Like… give us all a break. My favourite though… is one that is not as apparent, or even stated anywhere. It pertains to the revenue models of these ventures. Contrary to what many may think (especially the companies themselves), a revenue model was never part of the initial strategy.

To some, this may come as surprising. To others, it’s common knowledge. Many of these start-ups launch a FREE product with the intention of exploding onto the market, harnessing viral growth, and eventually selling to a larger, more established player. WOW, there is it. The revenue model is actually an exit strategy. I think that is a web 2.0 trend in itself.

Web 2.0 revenue model = Exit strategy

This makes sense for naive Internet entrepreneurs because:

  • It eliminates that monetary barrier to entry for users (as mentioned above)
  • They have no idea how to monetize a product in the first place AND/OR they find comfort in the the phrase, “We’ll build traffic, then figure out how to monetize later”.
  • The company realizes that if they do eventually implement a revenue model (advertising, subscription, etc…), they will piss off users and many will defect from the site or service.

So, as you can see, companies resort to the FREE model with the intention of ’slapping on’ a revenue model somewhere down the road. There never was a revenue model to begin with.

Now, don’t get me wrong… I love free products and don’t want to pay for anything if I don’t have to. But from a business perspective, that is not a sustainable or savvy model.

Joost Adds New Channels

Sunday, May 20th, 2007

Joost logoIn an e-mail message from the company, Joost states that they are adding over 40 new channels in the next week. A small sampling of channels to come includes:

  • National Geographic
  • Adult Swim
  • Spike TV
  • Heavy
  • Hasbro

Already accessible is content from MuchMusic, Virgin, and Alliance Atlantis to name a few.

Joost reiterates that they will be adding new channels on a weekly basis, so stay tuned. This bode well for the viewer, as well as the company. It creates a more “sticky” experience and drives users back. This, in turn, generates loyalty and residual traffic, and eventually, ad revenues.

I can’t wait for a ridiculous acquisition offer from a company with deep pockets, looking to break into the new-web space… Microsoft?….