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December 2008 Archives

December 2, 2008

The Law of Unintended Web-Site Use

The news that Ning is discontinuing support for adult oriented social networks got me thinking. There's an old economics axiom called the law of unintended consequences that says that "actions of people---and especially of government---always have effects that are unanticipated or unintended."

I think web-site's are the same way. You build a site intending for it to solve one problem, but once users get their hands on it, you find out its good for something else. The question is do you embrace that usage or shut it down. Here's a couple of examples:

* Craig's list - sure everybody's favorite lovable free classified site is a great way to get a job, find an apartment or join a band. Funnily enough, it turns out most people use it for the "erotic services" section. Intentional? Who knows. But the edgy content and the SEO-able nature of that section has proven an effective way for them to boot up local cities. Think the local newspapers websites in these towns would follow this strategy? Ha! And you know how well their sites are doing....

* Google - sure organizing the world's information and making it accessible is a lofty goal, but in reality, lots of the information being accessed is not so lofty. According to these stats, over 7% of the search query stream is actually porn. 7% may not sound like a lot but it's the 4th highest category and the top category is "other." Gee, I wonder why they have image and video search...?

* Facebook - it turns out that despite all the talk about the social graph, Mark Zuckerberg, etc., one of Facebook's biggest draws is that it's a photo sharing site. The killer app is that bit where you tag the individuals in each picture. The people I know who spend hours on that site spend most of that time looking at tagged photos.

* Pownce - yesterday's big news was that would be Twitter competitor Pownce was shutting down. Valleywag had this little nugget in its write-up: "Pownce allowed users to send each other short messages and, most importantly, share files; bootlegging MP3s was a popular if unacknowledged use."

None of these sites made these particular usages part of their core messaging, but they otherwise have have embraced them. Obviously, Pownce didn't end up succeeding - but that's probably for a host of reasons. Maybe they should've promoted the file-sharing bit more....couldn't have turned out worse.

As for the others, they certainly have done well. Probably one of the reasons is that they listened to their users. And by listen, I mean watch their usage.

Anyway, back to Ning. So your customers want to use your service as a place to create adult social networks? That use doesn't work for you? Fine. That may be the right decision for them. But as Chris notes, it's probably not the best way to treat your customers. And any company should be really careful cutting off legal uses of a product, just because they're not what was intended.

December 6, 2008

Serious Christmas Lights

Watch and enjoy....the fun really picks up about half-way through....

December 7, 2008

Newspapers: Time for a Hail Mary Pass

Today's top story in the newspaper world is that the Chicago Tribune seems to be headed towards bankruptcy.
Tribune has hired bankruptcy advisers as the ailing newspaper company faces a potential bankruptcy filing...

The newspaper, which was taken private last year by billionaire investor Samuel Zell, has hired advisers including Lazard and Sidley Austin...Tribune has been hobbled by debt related to that sale last year, which has been compounded by the growing drought of advertising for newspapers.

We sold Topix a little over 3.5 years ago to each of Tribune, Knight Ridder and Gannet. At that point, the three big newspaper companies were still relatively healthy. A lot has changed since then:

* In 2006, Knight Ridder was bought by McClatchy for approximately $4 billion. McClatchy's market cap as close last Friday: $181 million.

* In 2007, Tribune was taken private by Sam Zell. It's now is headed towards bankruptcy to restructure the very debt that allowed the private deal to happen.

* Gannett remains in the best shape of the three - their market cap still is over $2 billion. However, when we did the Topix deal in 2005, Gannett's stock was trading around $80/share. It closed last Friday at $8.92.

I know a lot has been written about the newspaper business and their drive to extinction - including many entries on this blog. Suffice it to say it boils down to wrong product at the wrong time with the wrong brands. Print: dead. Classified's: lost. Online: not working. No amount of window dressing can change these things.

It's time for a a strategy change. To use a football analogy, it's nearing the end of the 4th quarter. Three yards and a cloud of dust isn't working. You need a big play - the clock is about to expire. It's time for the Hail Mary pass. Throw it now, if its not already too late.

UPDATE: Done deal - Tribune went chapter this morning.

December 9, 2008

Gov. of Illinois: Hairpiece or Not?

Yeah, yeah, yeah - the Governor of Illinois was arrested on corruption charges. More interesting question: what kind of rug is that on his head? Here's the picture Drudge ran:


Got to to be a fake, no?

December 12, 2008

Art Garfunkel is Very Meticulous

I just ran across this page, which lists every book that the musician Art Garfunkel has ever read. You read that correctly, it's not just a list of his favorite books (those can be found here), it's a list of literally every book the man has read in the past 40 years. According to the site:
Since the 1960's, Art Garfunkel has been a voracious reader. We are pleased to present a listing of every book Art has read over the last 40 years...This book list has been divided into several pages to allow easy downloading. Each page indicates the author, title, date of publication and number of pages (when available).

I find this to be both odd and impressive. It's impressive that in the past 40 years, Art has read 1023 books. In other words, for basically my entire lifetime, he's read on average 25 books/ year - or a book every other week. (Although the cynic might joke that he's had lots of free time since 1970 - the year Simon ditched him.)

But as impressive as it is, its even odder to me that he maintained this list. For 40 years. And not on a computer for at least the first 10-20 years, I'm sure. Every time he bought? finished? a book, he logged it - along with the date of publication! Bizarre. But, again, impressive.

Of course, when he's not reading or OCD book logging, he's one of the best singers in the world. Here's the song the IMHO shows off his pipes the best:

December 17, 2008

Earth Eclipse

Discover Magazine is showing the top astronomy pictures of 2008 - definitely worth checking out. Here's a video of the moon eclipsing the earth:

The sites commentary of the video is worth noting too:

There has never been a generation of humans in all of history who could see such an event. If you ever get a little depressed, or lonely, or think like there’s nothing going on that’s interesting any more, think on that for a moment or two. A thousand generations of people could only imagine such a thing, but we can actually do it.

Pretty cool.

December 18, 2008

Credit Suisse Bankers To Eat Their Own Dogfood

(Via Dealbreaker) Looks like Credit Suisse Bankers will reap what they sowed:
[Credit Suisse Group AG’s investment bank] will use leveraged loans and commercial mortgage- backed debt to fund executive compensation packages....

The securities will be placed into a so-called Partner Asset Facility, and affected employees at the bank, Switzerland's second biggest, will be given stakes in the facility as part of their pay. Bonuses will take the first hit should the securities decline further in value.

Finally a solution to the financial crisis we can all get behind. No government bailouts, just making employees eat their own dogfood - which is what they should have been doing since the beginning.

Perhaps Detroit will get wind of this and figure out how to pay its executives and workers part of their compensation in Chevy Aveos.

December 22, 2008

Digg: I'm Actually Kind of Impressed

With the holiday schedule I've been slow in blogging and definitely late to the party on this one, but a couple of days ago somehow/ someway Digg's financials became public. As you probably heard, the numbers are smaller than people thought:
the company had 2007 revenues of $4.8 million and losses of $2.8 million. The first three quarters of 2008 Digg had revenues of $6.4 million and losses of $4 million. That implies total 2008 revenue of $8.5 million, with $5.3 million in losses.
This should be measured against Digg's audience size, which according to Comscore, is not small: they have 16 million monthly uniques and 58 million page views. Techcrunch correctly notes that these audience numbers, like most Comscore numbers, are likely smaller than the actual numbers.

People jumped all over this report, calling Digg's business model all sorts of nasty names. But the truth is that, compared to most others in the publishing world, Digg is actually doing pretty good. By my math, the reported revenue numbers show that Digg's earning a CPM rate of somewhere around $12. That's pretty good for the news business. Of course, we don't know how much of this is being artificially propped up by Digg's ad deal with Microsoft.

But still, in a world where most news sites are lucky to eek out $1 to $5 CPM, $12 CPM is very good. Especially for a site like Digg which is not verticalized or segmented. A few years back I met with the head of the online group of a major newspaper and asked him his CPM rate. He quoted $25 - their rate card. Then we did the math - adding up their total page views and revenue for the month and dividing.

Turns out this particular news site was making $.25 CPM, not $25 CPM. Sure they sold some pages (like real estate) for $25, but that was a tiny, tiny fraction of their sites total page views. Add it all up and the earnings on a CPM basis ended up amounting to little more than remnant prices.

So scoff all you want at Digg for not selling out when they should of or for having too many employees, but if you're in the publishing business its probably not wise to throw stones at their revenue numbers. Most publishers live in glass houses themselves.

December 24, 2008

A Wonderful Life? Predatory Lending in Bedford Falls

From the Bailey Building and Loan Board meeting:

Mr Potter (commenting on a questionable loan):

You see, if you shoot pool with some employee here, you can come and borrow money. What does that get us? A discontented, lazy rabble instead of a thrifty working class. And all because a few starry-eyed dreamers like Peter Bailey stir them up and fill their heads with a lot of impossible ideas [of owning their own home].

George Bailey (rebutting):

You said that they, they had to wait and save their money before they even thought of a decent home. Wait! Wait for what? Until their children grow up and leave them? Until they're so old and broken-down that they....just remember this, Mr. Potter, that this rabble you're talking about...they do most of the working and paying and living and dying in this community. Well, it is too much to have them work and pay and live and die in a couple of decent rooms and a bath?

Hmmmmm....isn't this exactly the type of predatory lending that got us into this housing crisis in the first place? And to think, Mr. Potter was always considered the bad guy in that movie!

Happy Holidays everyone!

December 31, 2008

Happy New Year!

About December 2008

This page contains all entries posted to Marksonland in December 2008. They are listed from oldest to newest.

November 2008 is the previous archive.

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