As for Adds, on the one hand he stresses the importance of the business model of Google by selling adds based on the data that you collect of a person. And of course, Google is wildly successful in selling adds. But on the other hand he explains that, due to the networked transparency that the Internet creates, advertising is less important. He even points out that not needing to advertise is a sign of success. To me that sounds like a contradiction. The more successful companies become in using the transparency of the Internet (created and improved in a large part by Google) the less profitable Google will become (and therefore not being able anymore to sustain their role in creating transparency). This catch 22 type of situation will no doubt have some equilibrium but is totally disregarded by Jeff Jarvis.
Another question about the business models on advertising that always puzzles me how far it can take us. If everybody would have advertising as their business model, who would pay for add? This “Addtention” economy can not encompass all, somewhere along the line people will have to pay for real products and services (and the companies selling these services are in the end the ones that are paying for the adds).
The second thing that puzzles me is Apples or, since they are unique, Apple. In many ways Apple is the opposite of Google. They create their products like an autist in splendid isolation. They are completely secretive about what they are doing and what products they are working on. They are closed in their hardware and most of their software and are ruthless towards people that breach that secrecy (or perhaps, HE is) is. And they too are wildly successful. This discrepancy is mentioned by Jeff Jarvis but immediately is put aside because “Apple is a class in it’s own”. But of course, Google is a class of it’s own too. The reasons why companies like Google, Apple and Microsoft are successful can never just be copied because their current success feeds on the fact that they became an outlier (meaning a small difference in the beginning created the opportunity to keep enlarging that advantage).
The good thing about the book are the hypothetical cases he discusses in the end. What if banks would be operated in a Google manner, or insurance companies, or a hospital. Lots of foods for thought there (talking about food: also what if a restaurant would operate like Google).
Banks are of course very much the focus of the news these days. One of the interesting news items a journalist found out is that Google already has a banking license in the Netherlands. Bank are potentially one of the sectors that will change a lot because of business possibilities that a technology like SaaS will enable. Competition will come from completely new sectors because they are better at reaching the market or using the “intelligence of crowds”.
While searching a little further I found this blog post from Jeff Jarvis where he is asking for examples of bank services that Google would be very good at. Examples are peer to peer lending, more transparency around transactions in stocks, open source platforms to increase functionality (E-invoices anyone?).
In a way Google checkout and it’s competitor PayPal are already on the move. In my view banks really have to start thinking on how to really innovate their processes through which they create value for their customers.
It is amazing how fast social networking is growing. Every time I am giving a presentation I always ask my audience how many people use one or more social networking sites like Facebook, MySPace, Hyves, LindedIn or another. Since a year this percentage is growing from 20% to more than 70% nowadays. I think especially business oriented sites like LinkedIn made social networking more “salonfähig” than before.
Social networking is I think an area where the idea of “the rich get richer” is especially true. After all, once you have many customers you tend to have more people sending invitation and there is more chance that people send invitations to you. One would expect that only some big sites remain and that newcomers have a hard time growing.
Therefore it is surprising that a new one, Plaxo, is really flooding my e-mail box. Many contacts have send me an invitation. After 10 invitations I decided to take a look, make an account and start using it too. I was a bit weary for this since using lot’s of sites is awkward, I thought.
But I must say this is a sticky one. Firstly they are very easy to link to your existing social networking site like LinkedIn. Secondly they use something they call “pulse”. On plaxo you can fill in the blogs you write, the photo sites you use and all other exhibitionist’s methods and they are shown in a log to all your contacts. This resulted in several comments on the photo you see above, I did not realize that it would be shown to all (welcome to the world of total transparency). Before I wrote about small world networks. One of the effects I see by using Plaxo is that you can see that lots or your contacts make contact with people you also know (and since you see this in the “pulse” you immediately connect to them too …).
One of the interesting developments in social networking is OpenSocial from Google, used by Plaxo too. Google failed miserable with Orkut and other social tools they developed. So they decided to create an API that makes it possible to integrate all social sites in an easy way. And thereby minimizing the advantage you have by having lots of members since everything integrates easily. And thereby minimizing your disadvantage when you have failed miserably in creatign you own social site. You have to admire them…
Rogier sent me this link. Especially this part was kind of icky:
The man made a note, did some clicking. “You see, I ask because I see a heavy spike in ads for rocketry supplies showing up alongside your search results and Google mail.”
Greg felt a spasm in his guts. “You’re looking at my searches and e-mail?” He hadn’t touched a keyboard in a month, but he knew what he put into that search bar was likely more revealing than what he told his shrink.
“Sir, calm down, please. No, I’m not looking at your searches,” the man said in a mocking whine. “That would be unconstitutional. We see only the ads that show up when you read your mail and do your searching.
“We do not look at your searches but at the add”. Somehow this statement gives me the shivers.
I am member of a guidance committee for Rathenau instituut in the Netherlands for a project about privacy. In this project we deal with the changing concept of privacy in our society. I talked about it some time ago in this post. It still amazes me how much people put on the net (including what I put on the Net, look at the sidebar of this Blog).
In this project a special website has been developed that invites people to comment on privacy, discuss and share all kind of ideas in a creative way around this subject (the website is www.privacyproject.nl). The information on the side ranges from exhibitionists to people putting an image of their passport on the web to people completely hiding how they look in real life. In the end a television documentary will be made out of it.
There is one item on the site that is I think very interesting. A colleague of mine, Rogier Brussee, has a conspiracy their for some time that Google is in fact a front for the NSA. Funny thing is if you look in the history of Google that they got quite large initial funding in order to pay for all the servers they needed to store all their data. Without it Google would not be able to show how good they are. But at this moment there really was not even a beginning of a business model. So his theory is that the NSA is the one that funded it (this is the organization with one of the largest budgets in the USA so funding 30 million dollar is mere noise to them). Their strong emphasis on “Don’t be Evil” of course fits nicely into this idea…
Just look at what Google knows of you:
It knows what you are interested in based on your searches as well as what link in the search results you clicked (the link you click on is not the real link but links to Google and than transfers you to the site you wish to go. Also you can save bookmarks, the kind of information on your iGoogle page, Google reader to show what blogs you are interested in (subscribed as well as the one you click on to read). The list goes on: adds you click on, the spell checker I use to check this blog so they already know I am writing about this before I post it …)
It knows what you are going to do based on your calendar info. The one thing that really surprises me is that Google does not yet have a tool to store your to-do items since this is a much better way (finer grained) for predicting what people are doing than your calendar).
It knows with whom you communicate and about what, based on your Gmail.
An of course, items like google apps enhance the knowledge about you by knowing what you are writing (though you would have sent it out with Gmail so they would have known anyhow.
Looking at this amount of data they have about a lot of people must the the ultimate dream of the NSA. Looking at the video below it is clear that more people are beginning to be suspicious.
Though I must say that I am totally addicted to Googe: Gmail, Calendar, Apps, Psearch, Scholar, and probably lots of others I use but do not know they are Googles (I use a very nice ToDo app that for all I know may be a front for Google (who is a front for …). I use them all because I like how they work (Hey Google, when are you going to develop this ToDo application, and when you are at it, why can’t I synchronize with my phone through SyncML…. If you do that you also know who I am calling).
Isn’t it funny how more and more things are being paid for by advertising while at the same time we all get more and more irritated by advertising being everywhere. The New York Times have stopped their paid subscription service in favor of free access. This is a subscription service that made them 10 million dollar a year. They now feel that they can make more money on advertising.
Somehow I sometimes get an uneasy feeling about all those things that are being paid by advertising money. Somehow I still think this business model has it’s limits. Let’s do a thought experiment:
Imagine that more and more companies are making money by mixing ads with the service they deliver to us. OK, let’s be really wild: imagine that all services are being paid for by advertising. Would that not be great: all services are free, all we have to do for it is accept some adds (and many we can block them?).
Problem is: who is going to pay for all these ads. The companies that make their money by selling ads together with their services will of course not be advertising, at least they will advertise less than they sell ads or they will lose money. So if everybody will give their services away for “adtention”, who will pay for the ads?
I can understand the business model of Google search. Since through the search I am implying what I am interested in I can imagine that an ad on that subject is worth money. But only if the one advertising his services is getting paid cash when he sells his product or service. When the advertiser is also getting paid by ads than it is starting to look like a pyramid scheme.