Don Dodge on The Next Big Thing

Googlepedia - Knol is Google's knowledge base

Nick Carr used the moniker Googlepedia which I think in one word sums up the essence of Google's Knol announcement. This makes a lot of sense for Google. Over 70% of Wikipedia's page views originate from a Google search. And, Wikipedia is the number one search result for LOTs of queries. As Nick Carr pointed out, this trend is increasing. Wikipedia is the trusted source for unbiased, up to date, information on almost any subject.

Danny Sullivan at SearchEngineLand got a look at the Knol service, see the screen shot below, and says this about Knol;

Google Knol is designed to allow anyone to create a page on any topic, which others can comment on, rate, and contribute to if the primary author allows. The service is in a private test beta. You can't apply to be part of it, nor can the pubic see the pages that have been made. Google also stressed to me that what's shown in the screenshots it provided might change and that the service might not launch at all.

 

Udi Manber, Google VP of Engineering wrote a blog today about Knol, and describes it this way;

The key idea behind the knol project is to highlight authors. Books have authors' names right on the cover, news articles have bylines, scientific articles always have authors -- but somehow the web evolved without a strong standard to keep authors names highlighted. We believe that knowing who wrote what will significantly help users make better use of web content. At the heart, a knol is just a web page; we use the word "knol" as the name of the project and as an instance of an article interchangeably. It is well-organized, nicely presented, and has a distinct look and feel, but it is still just a web page. Google will provide easy-to-use tools for writing, editing, and so on, and it will provide free hosting of the content. Writers only need to write; we'll do the rest.
A knol on a particular topic is meant to be the first thing someone who searches for this topic for the first time will want to read. The goal is for knols to cover all topics, from scientific concepts, to medical information, from geographical and historical, to entertainment, from product information, to how-to-fix-it instructions. Google will not serve as an editor in any way, and will not bless any content. All editorial responsibilities and control will rest with the authors. We hope that knols will include the opinions and points of view of the authors who will put their reputation on the line. Anyone will be free to write. For many topics, there will likely be competing knols on the same subject. Competition of ideas is a good thing.

From everything I have read Knol sounds like the best of Wikipedia and About.com, with great opportunities for quality traffic and advertising. Good move.

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Search engines are the Start page for the Internet

Google released its 2007 Zeitgeist list of most popular search terms. What is interesting about the list is how obvious the search terms are. Meaning, why would anyone enter these search terms, since in most cases the search term is itself the URL. Why not just type in the URL directly?

The answer is that search engines are the Start Page for the Internet. My guess is that most people have a search engine as their default home page on their browser.

There is another more subtle answer. Search engines are better at finding relevant content than the destination sites themselves. For example, if you were searching for a specific story on CNN or a specific topic on Wikipedia, would you go to that site and enter the search term on their internal search engine? Or would you just enter the term into your default web search engine? I have found that the major search engines are better at finding content than the destination sites themselves.

HitWise says that 70% of Wikipedia's traffic comes from Google searches. I know on this blog about 75% of the page views come from search engines, mostly Google.

Your regular traffic goes up when you advertise - Here is another odd fact about search engines. Search Engine Marketing people at many companies have told me that their organic search traffic goes up when they buy keyword advertising. They are perplexed as to why...and have considered reducing their advertising. I tell them to increase it. Here is why.

Free advertising -  A large portion of people don't like to click on ads. I have observed many people searching for things. They will glance at the ads on the right side bar, see something they like, and re-enter it into the search bar, rather than click on the ad. Why? They trust the search engine more than the ad. It is deeper than that. They trust the search engine to give them more useful information than the advertisement.

People are frustrated with search? I hear this all the time from the lesser known search engine people. They believe they have the answer, and can deliver better results. The facts say otherwise. The reality is that people are quite skilled at entering search keywords and finding what they want. They are not frustrated...and search traffic is increasing every month.

Search is big business. Each 1% of search engine market share is worth $1 Billion. But, even 1% is incredibly difficult to achieve. Google's market share is at 64% in the US and has been growing every quarter. Yahoo has 22%, Live has 7% and Ask has 5%. That is 98% for the top 4 search engines. AOL has at least 1% so that leaves less than 1% for the other hundreds of search engines to fight over. Not very good odds for a startup.

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58 Video Search companies - are any of them making money?

Video Search has been around a long time. My group at AltaVista was a pioneer in web video search back in 1996. The multi-media search technology is still in use today at Yahoo. Since then many startups and big players have entered the video search space. Are any of them making money? Are there any clear leaders?

VCs often call me for advice when they are considering investments in sectors or specific companies. I just did a meeting about the video search space. In preparation for the meeting I compiled a list, from various web sources, of companies involved in video search/sharing/tagging, and community. I was surprised to find over 50 companies, and I am sure I missed a bunch more.

My take? There is some great technology out there but no good business models or monetization mechanisms. The biggest players in the industry are making bets in this space and none of them have paid off yet. I don't see that changing for many years.

Google bought YouTube which combined great search technology with the biggest video library available. Google certainly knows the advertising game too. So, how is it working out for them? Well, the polite answer is...it's too early to tell. But, it is a good bet that they will figure it out in the long run and make it successful.

AOL bought Truveo and I would say the circumstances and results are about the same. Again, politely, it is too early to tell.

Yahoo, Microsoft, and Ask also have video search offerings. It is sort of expected that a world class search engine will have video, image, and music search. Do they attract big traffic numbers or revenues? Probably not, but it is considered "table stakes". With all these big players in the game do startups have a chance?

The innovative start-ups are not discouraged. They are charging ahead with new video search ideas. Many of them are adding social networks around video. They are adding sharing, voting, tagging, comments, and all the typical social networking features around video search hoping that will create a viable business model.

Take a look at these 58 web video companies as examples of different ways to approach the problem. In alphabetical order... 

AOL Uncut, Blip, Blinkz, Break, Brightcove, Clesh, Cuts, Dabble, Daily Motion, Dave.tv, DivX Stage 6, eefoof, EveryZing, Eyeka, Eyespot, Fliqz, FlixYa, Forscene, Google Video, Gotuit, Grouper, iFilm, JayCut, Jumpcut, Kewego, LiveVideo, Lycos Mix, Metacafe, Mojiti, MotionBox, MyHeavy, MyNumo, MySpaceTV, Ning, OneTrueMedia, PodTech,  Photobucket, Revver, SevenLoad, Soapbox, StashSpace, Sumo, Twango, Veoh, Viddler, Vidilife, Vimeo, Vmix, VodPod, Vsocial, Webshots, Yahoo Video, YouAreTV, YouTube, Yurth, Zeec and Ziddio.

What do you think? How many did I miss? Who do you think will emerge as winners? What business model will work? Should video content include video advertisements or standard text ads? Leave a comment and let me know what you think.

Oh, in case you are wondering...my advice to this investment group was to pass. There are lots of other areas to invest with better prospects for profits.

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Microsoft Enterprise Search - Freemium for the enterprise

Microsoft announced a new free enterprise search product Search Server 2008 Express. It has the same core search functionality as the regular enterprise search products,  and no restrictions on size or number of documents. The goal of the program is to reach the almost 6 million businesses in the United States that don't use an enterprise search solution.

Mary Jo Foley at ZDnet has an excellent review. Here is a quote from the story;

Search Server 2008 Express offers just about all of the same functionality as the full Microsoft Search Server and SharePoint Server products, Microsoft officials said. The Express SKU shares the same core search engine as Microsoft’s other two server-based enterprise-search offerings — Office SharePoint Server 2007 and Search Server (the rebranded standalone enterprise-search product formerly known by the ungainly name of “Microsoft Office SharePoint Server 2007 for Search”). It uses the same centralized administration console and new federated-search functionality. And Search Server 2008 Express will offer the same connectors to third-party document-management, ERP and other business software as do SharePoint Server and Search Server. And even though it’s going to be a free product, Express Server 2008 won’t limit the number of documents that can be indexed.

Enterprise search has been around a long time...even before consumer web search. But the technology has lagged because most enterprise search vendors have focused on a very narrow set of databases, applications, or document stores. They might be very good at searching a FileNet document repository but unable to do anything with a SharePoint repository.

Search Everything - Microsoft Enterprise Search has tackled this problem and now allows you to search just about everything from one search box. Microsoft uses the Open Search Standard to access lots of data sources. Here is a short list of some of the sources;

News: Live.com News, Yahoo News, Google News, Wired, The Register

Information Resources: MSDN, TechNet, Wikipedia, Encyclopedia Britannica, Yahoo

Media: Flickr, Yahoo Images, YouTube, PodScope

Blogs: Technorati, Google Blog Search

Microsoft Enterprise Search also has a long list of connectors to other data repositories that will include all documents in those applications. Here are just a few of them;

• BusinessObjects
• Cognos
• EMC Documentum
• Endeca
• OpenText
• SAS

Freemium in the enterprise? - Freemium is a common business model in the consumer space, but in the enterprise? Yes, Search Server 2008 Express is a free product with some up-sell opportunities. This is an amazingly full function product with no size limitations. The additional features for sale is truly "value add" functionality. Here is how Mary Jo Foley explains it;

The Express SKU won’t provide the high-availability and load-balancing capabilities of the other two Microsoft enterprise-search products, however, officials said. It also won’t deliver the people and expertise search and Business Data Catalog connectivity that SharePoint Server does. The Express SKU is designed to be simple enough to able to be set up to start searching and indexing in 30 minutes, the Softies said.

This is a bold move by Microsoft that will make enterprise search available to any business of any size...for free. The theory is that getting those 6 million U.S. businesses using enterprise search will result in more sales for the traditional Microsoft search server products.

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Search engine startups - IPO, M&A, or flameout?

The success of Google has spawned over 1,000 search related startups. Search market share is dominated (94%) by the big five; Google 53%, Yahoo 20%, Microsoft Live 14%, AOL 5%, and Ask 2%. That leaves 6% for everyone else. However, remember that "1% of search marketshare is worth $1 Billion". Will any of the 1,000 alternative search engines ever gain 1% market share?

Nitin at Software Abstractions has some thoughts about possible exit strategies for these small search engines. My thoughts? Some of these will be acquired by the big search engines or big content publishing networks. Most of them will fade away. I don't see any of them breaking out and creating a significant stand alone business with the possible exceptions of Powerset, Hakia, and Mahalo.

Charles Knight, keeper of the list of The top 100 Alternative Search Engines has suggested a Universal Interface for all of the alternative search engines as a way to aggregate traffic. There are already lots of meta-search engines, Dogpile is an example, that essentially do this now. They send your query to all the major search engines and present the results on one page. They use only the biggest and most popular search engines, and still they have far less than 1% market share. So, I don't see an alliance of the small search engines working either.

Human powered search, or “pre-created results pages”, seems to be popular now, but it too has been done before. Yahoo’s directory was an attempt by human editors to catalog and classify web sites in the early days. About.com used guides as topical editors to create very rich and useful links to content. Both approaches eliminated spam and SEO tricks.

Mahalo, and others, are doing the same thing today and calling it “human powered search”. Jason Calacanis is a talented entrepreneur, and he has some big backers like Sequoia, Mark Cuban and Elon Musk. If anyone can do it Calacanis can. But, I think history has proven that this approach will have marginal success.

Big content publishers can be very successful with the human prepared search approach. In fact, as readers this is what we expect from them. Be the editors that find and catalog the best content on any subject. They will of course highlight their own content, but that is fine with most readers. This is why I said earlier that some of the big content publishers will likely acquire some of these alternative search engines. It makes sense.

Vertical search - There are lots of opportunities in vertical search such as jobs, shopping, medical, investments, real estate, cars, etc. People search, classified search, and local search are also big opportunities. These are smaller niche markets but attract very high advertising rates. There are two or three players in each of these market segments that can build a reasonably profitable business.

My guess is that most of the alternative search engines focusing on broad web search will fail. A few will achieve some level of success and then be acquired by one of the big five search players or large content publishing networks. Vertical search engines will find some profitable niches.

The big untapped opportunities? Local search, mobile search, and voice search. I think all three of these will converge on the cell phone to create a whole new approach to search, and a new set of winners.

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Microsoft pushes privacy protection for search engines and advertising

Microsoft has joined with Ask.com in leading the search and advertising industry to adopt standard privacy principles for search history and click stream data. Google and DoubleClick store search queries and click stream histories on every user...in effort to serve up better search results and advertisements. Google has recently agreed to "anonymize" its search log data after two years.

Microsoft will make search query data anonymous after 18 months by permanently removing cookie IDs, the entire IP address and other identifiers from search terms. Microsoft will also work to give customers more control over what information it uses to personalize their online search experience. In connection with its efforts to support a common industry approach to privacy issues, Microsoft also announced that it will join the Network Advertising Initiative (NAI) later this year when it begins to offer third-party ad serving broadly.

Standards of use are needed to make consumers feel comfortable using any search engine, or clicking on any advertisement. As it stands today each search engine and advertising network makes up their own data retention and privacy rules...and they are all different.

What about the government and lawsuit discovery? Personally I feel reasonably comfortable that all the search engines will use my search histories in a reasonable way. I am more concerned about the government monitoring activity and lawyers digging deep in "discovery" on lawsuits, divorces, and both criminal and civil matters. If the search engines have the data the courts can force them to give it up...regardless of their stated privacy policies. The courts can over rule any company policy.

The simple answer is for the search engines and advertising networks to "anonymize" all data they keep, and to delete data after two years. The government and lawyers can't access what doesn't exist. Agreeing to privacy standards and data retention policies will make it safer for everyone to use the Internet.

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Powerset - Open Source approach to beat Google

Powerset is slowly coming out of stealth mode. Dan Farber at ZDNet has an excellent in depth story on Powerset and PowerLabs, their approach to including the community in developing and QA'ing the Powerset search engine index. It is a novel idea, empowering of the open source community to join the fight to beat Google. Open Source contributors love to join a crusade, contribute their skills, and change the world.

Steve Newcomb, co-founder of Powerset, said in the ZDNet story; “We want as many people in Powerlabs (as possible) to help us build and test the product. Powerlabs tells us when we are ready to go. We could have 50,000 people QAing our product,” he added. So far Powerset has 10,000 Powerlabs users. “Imagine how many widgets that could sit inside of Facebook, MySpace and even Second Life. It gives us the ability to launch with an extremely passionate set of people.”

Powerset is using linguistics and Natural Language Processing (NLP) to better understand the meaning and context of search queries. But the real power of Powerset is applied to the search index, not the query. The index of millions of web pages is indexed in the traditional way but they also analyze the pages for "semantics", context, meaning, similar words, and categories. They add all of this contextual meta data to the search index so that search queries can find better results.

Who is the best ballplayer of all time? Powerset breaks this query down very carefully using linguistic ontologies and all sorts of proprietary rules. For example, they know that "ballplayer" can mean Sports. Sports can be separated into categories that involve a "Ball". Things like baseball, basketball, soccer, and football. Note that soccer does not include the word ball, yet Powerset knows this is a sport that includes a ball.

Powerset knows that "ballplayer" can mean an individual player of a sport that includes a ball. They know that "best of all time" means history, not time in the clock sense.

Why hasn't this been done before? Powerset uses all these rules and linguistic approaches to analyze millions and billions of web pages, and adds "meta data" hooks into each word on each page. As you can imagine this is a huge scaling problem, that has been impossible to solve economically. With Moore's Law applied to constantly reducing the cost of computing, storage, and bandwidth, it is now possible to solve this problem, and within a few years it will be economically viable. Powerset may sustain some losses in the early years but economics and scale are on their side.

Remember, "Why 1% of search market share is worth over $1 Billion" This is a huge market with staggering growth. Powerset is banking the lowering cost curve and the growing revenue curve. Both curves are moving fast. Grabbing 1% of market share can pay for a lot of early costs.

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Powerset, Hakia, and Mahalo taking on Google

The New York Times, Sunday Edition, has a story "The Human Touch That May Loosen Google's Grip".  The NYT writer sets up the notion that Google can be toppled by using a quote from my earlier post "Why 1% of search market share is worth over $1 Billion" 

Even gathering the crumbs of business left behind by Google could generate a lofty market capitalization. Don Dodge, a Microsoft manager who works outside of the company’s search group, made this argument in a post on his personal blog last month: “Why 1% of Search Market Share Is Worth Over $1 Billion.” Mr. Dodge reasoned that 1 percent of the 7.3 billion searches performed in the United States in March, multiplied by 12 cents in advertising revenue per search, would yield annualized revenue of $105 million. Assuming a market cap that is 10 times revenue, his arithmetic leads to a billion-dollar company.

The story mentions Hakia and Powerset using Natural Language Processing to produce better results. The human touch is represented by Mahalo, a new search engine that uses humans to prepare search results for common queries.

Engines like Hakia, Accoona and Powerset are trying to grab market share by writing a more sophisticated algorithm. A growing number of entrepreneurs are placing their bets, however, on a hybrid system that puts humans back into the search equation. They are grouped under a newly coined rubric, “social search,” and it is becoming a crowded field.

Newcomers like Squidoo, Sproose and NosyJoe offer search results based on submissions or votes by users. Bessed also relies on users to suggest the best Web pages for a topic, but then has editors refine them. ChaCha gives customers the opportunity to have an online chat with a human being who can provide search assistance.

Mahalo now has pre-prepared pages for 5,000 terms related to entertainment, travel, health, technology and other subject areas. The company plans to expand its coverage to 10,000 terms by year-end, and eventually to provide results for one-third of the most common search terms.

There are hundreds of alternative search engines out there and more coming on everyday trying every imaginable approach to delivering better search. Charles Knight maintains and constantly updates a list of the top 100 alternative search engines. Here is a review of those companies and their approaches. Read these links for more in depth reviews of alternative search engines and new approaches to search.

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Marc Andreessen's big company turn around plan - Yahoo are you listening?

Marc Andreessen of Netscape fame has started blogging and has written a series of very insightful posts.  Today he writes "A Guide to Big Company Turn-arounds" which reads like a blueprint for how to turn around Yahoo (YHOO). Marc cites Hewlett Packard (HPQ) as a good example of how to do it, but the "guide" could be applied to any big company in trouble.

Marc outlines 9 steps to a successful turnaround. Please read his whole post, but here are 9 steps, with my short explanations. Marc goes into more depth in his post;

1. Go dark and execute - meaning don't talk to the press, just focus on getting the next 8 steps done.
2. Throw your predecessor under the bus - meaning blame your predecessor for everything and warn that it will take a year to fix everything.
3. Identify the 3-5 things that are working surprisingly well and double down on those. - Big companies have lots of products and projects. You can usually find some hidden jewels if you look really hard.
4. Identify the 3-5 things that are consuming lots of time and money, yet going nowhere, and kill those. This is critically important, otherwise it will be business as usual. Note, there may be more than 3 to 5 things that need to be killed.
5. Lay off a third of the work force. Tough but necessary. I was at DEC back in 1990 when layoffs happened every quarter for several years. There is nothing more debilitating and demoralizing than constant layoffs. Cut once and cut deep.
6. Reduce layers of management, then promote the "up and comers". Lets face it, the company got in this predicament because existing management was clueless. Get rid of them and promote some bright people who want to make good things happen.
7. Figure out the single most important thing your company must win, and put your single best person in charge of winning it. This step is strategic. The most important thing may not be one of the 3-5 things that are going well. You double down on those things to create some success and time to execute on the ONE thing that is absolutely essential to winning.
8. Look for 3-5 areas where your company is not playing or winning, but is clearly growing fast. Acquire the best company in that space. This will be expensive, but don't settle for the 3rd or 4th best company. Pay up and acquire the best. This will be your rocket fuel for growth.
9. In six months relaunch the company with a single, crisp, coherent, strategy and message. Then go dark again and execute on it. Sounds simple enough but most CEOs get consumed by the depressing details and forget to do the simple things.

Turning around a big company with 5,000 or more employees is a very difficult task. A new CEO from within the company will have a difficult time doing what is necessary. They were part of the problem and will have a hard time reversing some of the earlier decisions.

A new CEO from outside the company will not be constrained by prior decisions, old friendships, or pet projects. Making the deep cuts and canceling projects will be much easier. Sacred cows and long held beliefs will be open to re-examination.

Marc explains that big company turnarounds are very different from small company get well plans. One of the nice things about big companies is that they have a momentum that can sustain them. This is both good and bad. The trick is to find the "good" momentum and kill the "bad" momentum. The problem is that they don't walk around with signs identifying themselves as good or bad.

Small companies don't have the cash flow and momentum to carry them for a year while a new CEO figures out what to do. Small companies require immediate and decisive action. Cash is king in all decisions. Small company turnarounds usually focus on cash and customers first. Small companies may not have 3 to 5 things to promote and 3 to 5 things to kill. They may have only one thing...and you better make that one thing work in a hurry. I actually think it is harder to rescue a small company than a big company. But, the financial rewards for turning around a big company are insanely rich. Steve Jobs can tell you about that.

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Ask search engine has a new look

Ask.com, formerly Ask Jeeves, has introduced a new look they are calling Ask 3D. It is not 3D as in three dimensional viewing, it is 3D as in the three dimensions of searching - query expression, investigating results, and digging deeply into content.

The new look is a little confusing at first, mainly because we have all been conditioned to the "10 blue lines of search results" format of Google and other traditional search engines.

Query Expression - Ask has introduced emphasized lots of other features in the new UI. Things like "Narrow your Search" and "Expand your Search". Both features provide alternative search suggestions to help you focus or expand your search. Alternative search suggestions have been around for a while. We had them at AltaVista 10 years ago. But, the technology has improved significantly to the point where the alternative search suggestions are really good. It is a great feature.

Investingating Results - Ask has a little binoculars icon that indicates you can preview the page. Hover over the binoculars and the page pops up in preview mode. Another cool AJAX feature is the "roll over" on photo results that pops up a larger image.

Digging Deep Into Results - Another big change with Ask 3D is providing all the search result types on one page, meaning text results, photos, video, ecommerce links, etc. Again, we tried this at AltaVista and found that users didn't like it because it slowed things down. But, today high speed broadband and distributed data centers make it all happen in the blink of an eye.

The risky move in Ask 3D was moving the advertising out of the right column. Users have come to expect that the "organic" search results will be in the center pane, and the paid search results will be clearly separated. Advertising has always been on the right column pane. The right pane of Ask 3D is now devoted to images and video. If none are available for your search term it just remains blank.

Sponsored Results - It looks like all advertising on Ask is now in the form of "sponsored results" and appear at the top of the center pane along above the regular search results. It is a little tricky to see where the sponsored results end and the "organic" results begin. If you look really close you can see a very faint shadow around the sponsored results.

Ask made a good move with 3D. They needed to try something new to gain attention and more users. There are two immediate risks that I see. First, "look and feel" changes are easy to copy. The other search engines could introduce a similar look and feel within a very short time. No sustainable competitive advantage. Second, introducing new features and a new "look and feel" at the same time is very risky. USA Today made both changes at once and users revolted. The problem is too many variables make it hard to know if users are objecting to the new features or to the new look and feel.

Michael Arrington at TechCrunch has a nice review of the new Ask. I particularly liked this concise explantion;

The search results themselves are highly customized depending on what type of search is being conducted. Search for a music artist and see images of the artist along with clips from tracks via iLike in the right sidebar (Ask’s sister company, TicketMaster, recently invested in iLike). Search for a city and get different results in the sidebar - a map, weather information, the current time, photos and wikipedia information.

Jim Lanzone, CEO of Ask, is a smart guy. He tested these changes with users before implementing them. He will continue to tweak things and improve the user experience. Jim has said for a long time that even small search engines can be very profitable. I agree. remember my earlier post "Why 1% of search engine market share is worth over $1 billion" Ask currently has about 5% market share.

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