Insider Chatter by Donna Bogatin

Google to the Yahoo rescue? Hardly. I have long underscored that Barry Diller sells IAC shareholders short by selling out Ask.com’s search advertising to Google.

In announcing the IAC plan to spin-off HSN, Ticketmaster, Interval and Lending Tress as four distinct publicly traded companies, Diller said his online advertising focused “Internet conglomerate,” of which Ask.com is a trophy property, will benefit from “standing on its own.” YES, but so would the competitive operations of Ask.com, far from competitor Google’s monopoly seeking hands.

Google is Ask’s prime competitor. While Google is a cheery proponent of coopetition, the only chance for an underdog to become the big dog is to rely on itself for its independent, proprietary future, rather than piggybacking on the success of the single, biggest, arch competitive rival. Yahoo has long understood the need to remain independent of Google and ought to continue to maintain the integrity of its core product offering, come what may.

My question for Diller last year was:

You indicated this morning that starting as the number five search engine is not a bad thing. Yesterday, you inferred that being the number four search advertising network may not be a good thing.  Why are you willing to share Ask’s monetization with competitor Google when you believe “if there is no other ad network than Google, then we are all in trouble.”

Diller told Wall Street:

As far as doing it ourselves, we thought originally and we continue to do work in this area. We do do it ourselves; we do all sorts of ad products inside Ask.com for ourselves, for our own account. But as far as the ad network business, there are, as you know, three players in it currently. I think there probably won’t be a fourth. At some point, I can’t say what will happen out of the growth of advertising in this area, but right now, I would much, much, much prefer to rent it. I think that we will be well-served by that, certainly for a period of time.

Diller’s short-term sell out to his search enemy weakens Ask.com long term and strengthens Google’s winning position, at the expense of contendor Ask.com.

Microsoft’s bid for Yahoo changes the market landscape, but does not render a Yahoo capitulation and amputation at the hands of Google a worthy option. Microsoft is being straightforward about its intentions towards Yahoo, buy and control. Google, as is its fashion, offers a friendly carrot to Yahoo, while seeking its Googley end goal of usurping search advertising share to eliminate a strong competitor and using Yahoo to hurt Microsoft, Eric Schmidt’s despised foe.

Yahoo seemingly has no shareholder value option at this time other than to succumb to new Microsoft ownership. Yahoo owned by Microsoft is NOT the end of the Yahoo brand world though. Microsoft wants Yahoo and needs it as a full partner in a mutually beneficial attack against Google. Google, on the other number one hand, only wants to use Yahoo to further consolidate its search monopoly grip on the Web, for its sole Google shareholder advantage.

Microsoft is NOT a Yahoo enemy, Google is.

MORE: Is Union Square Ventures Changing Exit Strategies? and Microsoft’s Yahoo Bid a Winner: Google Running Scared! and Yahoo Shareholder on Microsoft Bid: AOL, Time Warner All Over Again? and Google Execs Silent On NYC Print, Radio, TV Promises 

PLUS: LinkedIn To Mine User Data For Corporate Espionage

CONTACT DONNA BOGATIN

Who needs the standard obsessively glowing Michael TechCrunch Arrington Web 2.0 startup co-hype machine! NOT Jimmy Wales. After all, Wales underscores Wikia Search “is not being built for him.”

It is indeed ironic to read Arrington decry of the alpha launch:”Jimmy Wales hype machine promised a human powered search engine that could take on Google”:

The search results are poor and thin, as would be expected if not for the huge expectations that have been set.

Really? Wales disclaims the alpha launch quality of the search results, front and center:

Wikia is working to develop and popularize a freely licensed (open source) search engine. What you see here is our first alpha release. We are aware that the quality of the search results is low..

Wales also goes on to solicit humans for help with his “project to build a human-powered search engine”:

Right now, the most important thing you can do is help with the “miniarticles” that appear at the top of popular search terms.

Arrington nevertheless dismisses Wikia Search’s request for participation:

Beyond the poor search results, there is really no “human” element to the engine at all.

Eventually, users will be able to edit and improve results for searches they are interested in. But currently, all users can do is add keywords to their profile that they might someday be interested in, and/or contribute to a “mini-article” that appears at the top of search results for queries.

BUT, how is functionality enabling individuals to contribute content NOT a human element?

Wikia Search’s solicitation for mini-article contributions is similar to Arrington’s TechCrunch 40 partner Jason Calacanis’ Mahalo, self-branded a “human-powered search engine.” Mahalao has benefitted from Arrington hype from the get go, along with search startup contender Powerset–supposedly launched at TechCrunch 40 four months ago, although still not open for searching. The latest non-existent search startup to get the Arrington hype stamp of approval: Rich Skrenta’s puported “Blekko.”

(SEE: Mahalo: Will Calacanis Win the Billion Dollar Startup Lottery in 2008? and Rich Skrenta: Blekko ‘Absurd’ Search Startup Disses King Google)

Powerset on its supposed TechCrunch launch:

We realize that most companies wait to launch until they have a completely usable beta version. Because Powerset is a natural language search engine, the earlier we have input from the best natural language processing units on the planet – the brains of humans – the quicker our search engine will improve.

Mahalo is also a work in human progress. A search at Mahalo for “reverse engineering” yields a page of search engine results, courtsey of Mahalo’s arch enemy Google! Plus the disclaimer: “We haven’t written a result page for ‘reverse engineering’ yet,” but be sure to request one. Better yet, Calacanis’ Mahalao solicits “Be the first to recomend a link form ‘reverse engineering’.

Arrington is nevertheless firm, about Jimmy Wales :

Wikia search would be a disappointment even without the massive hype we’ve had to endure. And taking that hype into account, this product is an inexcusable waste of time.

Such an accusation could be levied against many of the massively hyped Web 2.0 “cool apps” paraded by TechCrunch daily and “endured” by all. After all, Tim Web 2.0 O’Reilly believes TechCrunch faves to be “completely unimportant”:

TechCrunch is the #1 site on the Techmeme leaderboard, yet most of what it covers will be forgotten not merely in years but in months, and have proven to be completely unimportant: the froth of me-too company creation around ideas and trends that as yet are quite immature and poorly understood. (Michael Arrington himself told me that most of the companies he’s covered since starting Techcrunch “have just faded away”.)

(SEE: Web 2.0 Startups: Will Geek Chumby ‘Fade Away’ in 2008? and Digg: TechCrunch Bails on Arrington Web 2.0 Fave and  Edgeio Web 2.0 Bomb: Michael TechCrunch Arrington Cheers $5 million Startup Loss)

Google’s Matt Cutts giddily jumps on the blogosphere’s who needs Wikia Search bandwagon, cunningly goading the SEO community–which bows to King Google–to tear the Wales initiative apart.

Cutts ought to look within, though. For starters, he can read my primer on how Google Search is on the endangered species list: Google Knol: The End of Google.com, NOT Wikipedia 

PLUS, Cutts can learn about how Google is behind the image search times by reading my exclusive scoop: EverNote Beats Google: AIR Search Inside Images, NOW!

ALSO, Cutts may want to know Why Google Worship is a BAD Call in 2008, despite Jeff Jarvis’ Google religion.

MORE: Is SEO the New Internet Porn? Lessons From Ning and Google and Reach Local Advertising? How Google Squeezes SEMs and AdWords Buyers

PLUS: Data Portability ‘Magic’? Australian Faraday Media Pushes Web Agenda in U.S.

CONTACT DONNA BOGATIN

Nick Ciarelli is NO Bob Woodward or Carl Bernstein. What’s more, His Think Secret so-called sources are no “Deep Throat.” Most importantly, the unauthorized public release of proprietary corporate competitive information is NOT a noble endeavor, as was the Pultizer Prize winning journalism achieved by The Washington Post in investigating the arrest of five burglars at the Democratic National Committee offices in the Watergate complex.

Why did Ciarelli succumb to Apple’s contention that he is NO journalist and shut down his blog? The Think Secret unprofessional tag line, an embarrassment to the professional practice of journalism, solicits “GOT DIRT?” encouraging  ANONYMOUS VOICE MAIL “tips,” hardly the modus operandi of professional publications.  

The Society of Professional Journalists (SPJ) and its Code of Ethics does NOT encourage anonymous “sourcing”:

Members of the Society of Professional Journalists believe that public enlightenment is the forerunner of justice and the foundation of democracy. The duty of the journalist is to further those ends by seeking truth.

But truth is hard to come by, without naming names.

The SPJ on naming sources, or not: 

Identify sources whenever feasible. The public is entitled to as much information as possible on sources’ reliability.

Always question sources’ motives before promising anonymity. Clarify conditions attached to any promise made in exchange for information.

Readers ought to question any and all stories based solely on unidentified sources, no matter the editorial masthead. The facts are clear: The reliability, or not, of a story based on unamed sources can not be determined.

Apple and Think Secret have settled their lawsuit, reaching an agreement that results in a positive solution for both sides. As part of the confidential settlement, no sources were revealed and Think Secret will no longer be published. Nick Ciarelli, Think Secret’s publisher, said, “I’m pleased to have reached this amicable settlement, and now will be able to move forward with my college studies and broader journalistic pursuits.”

Next time, Ciarelli may be naming names.

ALSO: Gawker: Will Nick Denton PAY For Media Respectability? and Google Zeitgeist: $200 University Payola AdWords Scam and Digg: TechCrunch Bails on Arrington Web 2.0 Fave

CONTACT DONNA BOGATIN

Are consumers really in control in this Web 2.0 era of local social media? Citysearch President Jay Herratti shared in his Kelsey Interactive Local Media keynote yesterday that merchant requests for removal of consumer reviews is the number one ”complaint escalation” he is called upon to arbitrate.

I met with Herratti following his presentation to discuss how Citysearch aims to help both merchants and consumers “make sense of” and “sort out” the burgeoning, and increasingly cacaphonous, world of online user generated content in the local space. 

Reputation management is an increasing imperative for local merchants as consumers become more and more active in sharing their experiences online, Herratti said. The passionate pleas from local businesses, and legal letters from lawyers, that reach the Citysearch president’s desk on a regular basis underscores the influence consumer opinions now have on SME’s prospects, he indicated. 

Merchants request removal of consumer reviews from Citysearch that they deem to be inaccurate and/or damaging, according to Herratti. During his keynote, Herratti described the cases of two restaurants that sought consumer review deletions from Citysearch.

When a restaurant in San Francisco changed ownership, the new management claimed that its prior track record, as described by consumers at Citysearch, no longer applied. Herratti determined, however, that as the restaurant continued to operate under the same name, the new investors acquired the business reputation along with its hard assets: No removal of reviews.

After a patron had an unfortunate experience under a pigeon while dining at one establishment, the customer was unable to find pleasure in any aspect of the restaurant’s experience and shared all online. While the merchant pleaded that pigeons don’t ordinarily interfere with their customers, Herratti determined the consumers’ review to be consistent with Citysearch’s “Ten Commandments” because the review added value by describing an actual consumer experience: No removal of review.

I asked Herratti if the two restaurants he described were Citysearch advertisers. Herratti said he was unaware, because client status does not factor into his decisions. Nevertheless, Citysearch sales reps will seek consumer review arbitration on behalf of client accounts. Regardless, most consumer reviews remain, Herratti told me.

I asked Herratti if, and under what circumstances, he WOULD agree to remove a consumer review. Citysearch consumer review decisions are based on its explicit Terms of Use, Herratti told me. Unacceptable review content includes:

1. Offensive, harmful and/or abusive language, including without limitation: expletives, profanities, obscenities, harassment, vulgarities, sexually explicit language and hate speech (e.g., racist/discriminatory speech.)
2. References to illegal activity, malpractice, purposeful overcharging, false advertising or health code violations (e.g., food poisoning, foreign objects in food, etc.)
3. Reviews submitted by the reviewed business’s employees (past or present) or competitors as determined by Citysearch.
4. Reviews that do not address the goods and services of the business or reviews with no qualitative value (e.g., “this place is great!”) as determined by Citysearch in its sole discretion.
5. Reviews commenting on other users.
6. Content that contains personal attacks or describes physical confrontations and/or sexual harassment.
7. Excessive damage caused by business or service to person or property.
8. Personal information or messages including email addresses, URLs, phone numbers and postal addresses.
9. Messages that are advertising or commercial in nature, or are inappropriate based on the applicable subject matter.
10. Language that violates the standards of good taste or the standards of this website, as determined by Citysearch in its sole discretion.

To assist local businesses in managing their reputations online, Citysearch offers a “merchant reply tool.”

To help consumers filter the hundreds of thousands, and counting, consumer reviews available at Citysearch, a new “Reviews Dashboard” is offered. Citysearch aims to give users a manageable, one-screen, snapshot of the aggregate consumer reaction to local establishments.

The Citysearch “Reviews Dashboard” features a “Ratings Roundup” and “The Verdict.” Local merchants will nevertheless undoubtedly continue to contest consumers’ verdicts.

MORE FROM KELSEY CONFERENCE: Google Beware: Facebook Takes Local Advertising Gloves Off, ILM REPORT and
Local Advertising Online: SMEs Hold the Billion Dollar Keys, ILM ANALYSIS and
Google Apps & Maps: Enterprise and Local Business STILL Missing and
The Future of Local IS (Google) Search: ILM REPORT and
Local is Global: $134 billion in Yellow Pages, Classifieds and Internet Advertising, ILM REPORT and
Jason Calacanis: ‘I Am Wrong About Local Too,” ILM REPORT

ALSO: Sony Jeopardy! Union and Studio Egos in the Way? WGA STRIKE INTERVIEWS

CONTACT DONNA BOGATIN

I have been asking Ask.com if would bite the we can sell all our own ads bullet for the past year. Parent IAC proudly answered NO today: Barry Diller hailing a $3.5 billion plus five year re-upping with Google.

Last January, I asked Jim Lanzone, Ask.com CEO: “On January 1, 2008, will Ask.com have renewed its paid listing agrement with Google?”

Lanzone told me:

We have to do what is in our short and long term best interests, we have to focus on ROI…Google has historically paid the most, they can give a better deal to potential partners.

We will most likley strike another deal with one of the major netwroks because our own ad system combined with our own ad system will make us the most money. It is going t be a significant deal. We will be the ones with the power in the relationship because we own our traffic.

Ten months later, Lanzone’s foretelling was realized. Ask.com has renewed its relationship with Google, in a long-term deal that IAC is declaring a homerun.

What if IAC controlled all of Ask.com’s ad sales, however? With no rev share, instead of a Google home run, Ask.com could very well hit its own ball out of the advertising park!

Just weeks after I intereviewed Lanzone, Barry Diller weighed-in on the to Google or not to Google Ask.com question, during his Q4 2006 Wall Street earnings call.

DILLER QUESTION: Would it not be more advantageous long-term if Ask.com handled all of its advertising in-house?

As far as doing it ourselves, we thought originally and we continue to do work in this area. We do do it ourselves; we do all sorts of ad products inside Ask.com for ourselves, for our own account. But as far as the ad network business, there are, as you know, three players in it currently. I think there probably won’t be a fourth. At some point, I can’t say what will happen out of the growth of advertising in this area, but right now, I would much, much, much prefer to rent it. I think that we will be well-served by that, certainly for a period of time.

The day after Diller’s remarks to wall Street, I heard the IAC CEO address the 2007 Media Summit New York. No opportunity was provided for Q & A upon the conclusion of Diller’s talk; The question I prepared for Diller was: 

You indicated this morning that starting as the number five search engine is not a bad thing. Yesterday, you inferred that being the number four search advertising network may not be a good thing. 

Why are you willing to share Ask’s monetization with competitor Google when you believe “if there is no other ad network than Google, then we are all in trouble.”

In announcing today the IAC plan to spin-off HSN, Ticketmaster, Interval and Lending Tress as four distinct publicly traded companies, Diller said his online advertising focused “Internet conglomerate,” of which Ask.com is a trophy property, will benefit form “standing on its own.”

Wouldn’t Ask.com itself benefit even more from standing on its own, for ALL its advertising?

Google is Ask’s prime competitor. While Google can afford to be a strong proponent of coopetition, underdogs have a greater chance of becoming the big dog if they rely on themselves for their futures, rather than piggybacking on the success of their arch competitive rivals.

MORE: Ad-Tech: BuzzLogic Latest to Push Google AdSense and Attributor Launch Blasts AdSense Pirating: Google Beware and Tom Curley AP Crusade: Google AdSense Lawsuit Near? Thanks to Attributor

PLUS: Facebook Puts Freeloader Users On Sale To Highest Bidders!

CONTACT DONNA BOGATIN

Google’s claim to AdSense fame is that its two line text ads are “so well-matched, that your readers will actually find them useful.”

How useful will Anil Dash’s readers really find his blog’s plug for the “New Mac OS X Leopard” available now with free shipping direct from the Apple Store though? After all, the “Ads by Google” Apple OS ad may be color-coordinated to match Dash’s purple blog theme, but the product pitch certainly does not reflect the message his blog is sending today, i.e., “THE WORST THING ABOUT APPLE”

Dash on Apple:

Although I’ve been accused sometimes of reflexive contrariness, the truth is I’m just pretty consistent in my assessments of technology, with little regard for the perceptions of the companies or people who provide those technologies.

The best case in point I can use to illustrate this is an example of the worst thing about Apple. There is simply nothing less attractive than a person who is both flawed and smug, and apparently one of the few plausible justifications for treating corporations as legal persons is the fact that this holds true for companies as well. And Apple is a smug company.

The new version 10.5 of Mac OS X rather famously features a display when you’re browsing machines that appear to be running Microsoft Windows. The image deliberately uses an aged-looking monitor and a crashed computer as the illustration of your other computers. The disdain here isn’t for the unfortunate unwashed who have to suffer through Windows because they’re so clueless — it’s a snide shot at the other computers you own, or of your family’s other machines around the house, or of the computers of the peers you work with. In short, the derision is likely aimed at people who care a hell of a lot more about you and your boundless Mac-enhanced creativity than, say, the OS X team does.

Unfortunate Google AdSense advertising adjancencies are not only the Web’s bloopers, they underscore that contextual advertiisng is NOT a “solved problem,” not even for number one Google.

AdTech takes New York City by storm next week, perhaps there are some ad network disruptors in store  ready to deliver that ever elusive Google “killer.”

MORE ADSENSE BLOOPERS: Nick Carr Comes To His Senses: Goodbye Google AdSense!

PLUS: Business Plans Help the Web 2.0 Kool-Aid Go Down and YAY! Facebook Junk Now Open Social Web Free For All

CONTACT DONNA BOGATIN