Seems pretty predictable to me. Facebook will do whatever it needs to win the battle. My commentary here: http://swombat.com/2011/3/5/facebook-predictably-bans-adsens...
This is what I find frightening about the changing landscape of ever more tightly controlled "platforms". It used to be that the way software interacted with a platform was via APIs; now it's increasingly alignment with the platform owner's business goals as well.
When Microsoft crushed Netscape it did so by controlling the platform and making the alternative seem unnecessary, but it would have been unthinkably brutish for them to disallow another browser. But what the App Store and Facebook are doing makes Microsoft's actions look positively charitable.
I believe there is a question of at which point a platform becomes large enough that there is a legitimate concern of the public interest involved. Obviously the US and EU governments thought such was the case with Windows. I wonder if the resolution to these things will come by similar means.
I think 'Don't attribute to malice what can be attributed to incompetence' is true the case of the article. Browsers are extremely complicated things.
On the other hand, if you solve the problem with regulation, then the regulated body has a powerful tool for maintaining their monopoly: forcing their regulation onto their startup competitors. For example VOIP got saddled with regulation for local 911 calling and easy government wiretapping. Internet radio has to pay some of the worst rates possible under the agreement content producers made with radio stations -- I think this is largely due to gov involvement in radio.
You mean like how they printed an error message if you were running another DOS?
(They did disable the error message in the final release, though.)
What I love and find scary about this whole thing is that i feel like I am watching Neuromancer come to life - the online landscape of the internet - which used to seem like a massive coop of all these companies for the greater good of information freedom is now replaced by massive walled gardens, protected not so much by lethal ICE apps, but by corporate dogma, policy and ruthless greed.
Sure, its not quite a dangerous network in which your wetwire cant be used to kill you -- but we aren't yet in 2020.
I am in wonder and shock that the Cyberpunk fantasies of my childhood are the reality of my adulthood. My children will be the characters I used to role play when I was slightly older than they are now.
On facebook you are checking out your friends and the adds are not immediately relevant to the reason why you are on facebook. makes a huge difference.
Facebook needs to build a search engine and the social graph should be a subset of the results like Google categorizes images, videos, maps etc on the top/left.
Once fb builds buys a real search engine (blekko) the game could change very very suddenly
If I was facebook, I'd focus on social activities that I'd be interested in while interacting with my friends. Ski trips, wii games, etc.
But just because your revenue model needs work doesn't mean you should leave the door wide open to your largest competitor to steal your customers who are building apps on your very own platform!
Facebook's move makes perfect sense. I'm surprised they didn't do it sooner.
The ads would be of various standard banner sizes
Placed via iFrame so they were contextually relevant to the page you were on, but also socially tied back to the person doing the viewing - cookie tracking the user.
Self management system through facebook gets an option for placement on the "extended network"
I bet facebook clickrates would go WAY up because the ads would be everywhere.
What's even better is people who get "BANNED FROM ADSENSE" would have a real viable alternative.
It's not a small task - but - seems the way to go. Facebook Adsense
If other words, it is mistake to equate Google AdWords with Facebook Ads platform. They should be used differently.
I like to look at the comparison of google ads vs facebook ads as such: If you want to provide a service/product to people who are seeking that solution, use Google ads. And if you want to go to the targeted demographic directly and present your solution/product/message, use Facebook.
An example would be if you sold wedding services in miami. You could go on facebook and target women 25-35 who are engaged and live in miami. The ads would display only for the targeted demographic and would likely have a good click-through rate. Or you could go into google adwords and buy terms related to wedding services miami or zipcode+wedding service. The differences here are that a woman in the younger demographic is much more likely to be spending hours on facebook and only minutes on a google search.
In addition, google also has incredibly high competition for some of the more lucrative keywords and it is getting increasingly more competitive in local search, now requiring a top 7 ranking to really matter in the local listings.
Also, never underestimate the cpm (cost per thousand) displays of facebook ads to the targeted demographic. They work great for events like concerts and other events when simple awareness is key. A good image also helps a lot, as I run ads with the same text and different images and see dramatic differences in the number of clicks.
It's difficult for me to believe that "nobody cares about Facebook ads and no one clicks on them" because Facebook Ads (and Google Adwords/Adsense) operate as markets, with a bidding system on price. I almost don't want to post this because the more people who know about and use facebook ads, the higher the price rises. Their prices have been steadily rising over the last year as more and more business try them out. They do work, but not for every product and not for every demographic. But people wonder how facebook can have such a high valuation, because they underestimate the amount of direct access and data Facebook has to over 500 million people.
The ads do work, but to create a good campaign requires knowledge of the platform, and experience in marketing, advertising, and copywriting. Laypeople assume they don't need marketers and can do buys themselves, and more cheaply, but usually end up spending more. The true gold in online advertising though, comes from what happens after the person clicks.
You could go on facebook and target women 25-35 who are engaged and live in miami. If Facebook's booster can't find a different glittering hypothetical, they are going to be in trouble... What about "barbers in St. Louis"? Uh wait, barbers in St. Louis actually need almost exactly what barbers in Houston need. The virtue of online business isn't "targeting" but finding something lots of people need.
Engaged? I think I remember friends talking what it's like having your Facebook profile say "engaged". Boy, that's one status that every retailer thinks they can exploit.
It's difficult for me to believe that "nobody cares about Facebook ads and no one clicks on them" because Facebook Ads (and Google Adwords/Adsense) operate as markets, with a bidding system on price.
If your reasoning was correct, nothing sold at an auction would ever be a bad deal.
But given that Facebook is seen as the next platform, every minute one has to presume that a new-customer appears to try and take advantage of this great platform. But frequency of these customers appearing doesn't prove that they are getting a deal that works for them.
Agreed about "engaged" status though
My point is that the number of business that actually engage in very-narrow-targeting are small. And the target groups tend be overwhelmed by this token. What percentage of the population makes major purchases very specific to their demographic? Is it not high (weddings, college, funerals? Anniversaries? You start to run out after a short time). The rich can also be target and are targeted and you are again back in the "not-a-slam-dunk" range.
A San Francisco dominatrix still buys a car and a washing machine in the same fashion as a mid-western minister.
If you look at the idea behind Facebook advertising, you'll see it's actually the old model of brand advertising - somehow injecting an irrational connection between the customer and the product. It's just that brand advertising rightly imagine they can get more traction if they know the exact demographic someone is one. They might indeed do so but it's still in the same realm. The goal is to sway someone's purchase decision when that someone is at a store and has to decide ten different otherwise identical whats-its. The smallest prejudice you can insert will be worth a lot to you here.
But the Google model is the opposite - informational advertising. The model of offering an honest argument for a product that the person is actively seeking.
A Facebook ad is essentially about hijacking attention. Hoping you'll get some free-floating interest from someone who isn't otherwise thinking about your offer.
A web page gets you the chance to make your case to those who are interested in your case. What objectively makes your service better.
Does a cleaning service want barbers? It wants customer in the million-person city of St. Louis but that's a big group. It mostly wants anyone who actually needs a cleaning service. And then there are a lot of things to say but this basic is pretty simple.
Yes, but here is the key. It's all about attitude when presented with the ad. Those few minutes on Google are being spent actively seeking information about that particular topic. The hours on Facebook are about find out what friends are up to, with little thought about finding information.
So as with most things, your blanket statement doesn't ring true to others; and ymmv.
There - Don't say I've never curated content for you :)
Time will tell, of course.
So now we see who is the real powerhouse and if the Facebook is the Google killer hype lives up to its expectations.
I place my bet on Google, I also see in my crystal ball that Zuckenberg is going to do something so stupid and greedy that he will shadow Rupert Murdoch. And I also divine that this will happen in next 5 years. By 2016 you will see headlines: Facebook is dead, Larry Page reads obituary. Stock options worthless.
While I don't think fb will die soon, of the two companies I'd say Google has the far higher staying power (and is more ethical)
Make no mistake, Google is scared stupid. They know their core business is in the crosshairs of both Facebook and Apple. They won't go down without a fight, but that Google is reaching out in every possible direction clearly shows that they know they need to move fast to avoid the situation Microsoft is now in (irrelevancy).
Two determined opponents are about to do battle... both are composed of very smart and motivated people. One side gets slaughtered if they lose, the other side just has to walk back home and continue to enjoy their current lifestyle. Are you sure you're betting on the right side?
The dinner/life argument is true when we observe creatures that have co-evolved over a long period of time to reach an equilibrium of sorts in an ecological niche. Foxes catch some rabbits, but not enough to wipe them out, and not so few that foxes starve.
However, along the way there may have been other predators that starved to death because they couldn't catch any rabbits. And other prey animals that couldn't run fast enough and were wiped out. If we travel to a new ecological niche like a volcanic island that has risen from the sea, and there we observe one fox chasing a rabbit, it isn't a safe bet that the rabbit will escape the fox. We don't have evidence that foxes and rabbits are in equilibrium on that island, with both species able to eat enough and live long enough to reliably produce offspring.
Looking at Facebook and Google, we are not talking about the business equivalent of evolutionary time, and we are not talking about whole classes of businesses. Even though Facebook is running for its life, Google can easily wipe them out, just as on our volcanic island, one fox might easily eat one or for that matter all rabbits.
Footnote for the curious: https://secure.wikimedia.org/wikipedia/en/wiki/Ilha_da_Queim...
Amazon must be shaking in their boots because of all these hot up and coming flash gaming sites.
To my knowledge, Rupert Murdoch is still obscenely rich and widely considered to be enormously successful.
In 5 years, I'll bet you'll see Facebook and Google teaming up against X, how crazy a prediction is that?
It is perfectly possible to have a world in which both Google and Facebook exists and exist as giants.
It is perfectly possible to have a world in which Facebook loses a lot of its current sheen, but still rakes in a handsome profit. Google will continue to be brilliantly profitable, but the blowout quarters will be harder to come by.
Most market segments are large enough to support, 1,2 or 3 profitable leaders. Even in a segment as niche as commercial aircrafts, you have multiple players. The entire contention of one killer market leader is the greatest eyewash of our times.
One a sidenote, I think it's ludicrous to even suggest Facebook is a Google killer. It's a social network. That's all it is. Unless you have people that you interact with on it, it's pretty useless. My 2 cents.
Facebook only has one enemy, besides the Federal Government.
Finding a good ad provider seems to be exceedingly difficult :/
It's completely true that most of these networks run offers that are the 2nd tier "enlargement" and "weight loss" fare -- that sort of thing is probably 75% of their available offers and 99% of their revenue. But a good pub on a top CPA network can make a lot more money than a good pub using Adsense.
Your best bet for finding someone who is big enough to have offers, but not so that they turn people down. Try Commission Junction for a proper 'place CPA banner Ad' type setup.
They'll (probably) have you.
Once you're reliably making a few hundred to a few thousand a month, then you'll be able to waltz in to Adzoogle and any other affiliate network you want. As it turns out though, a lot of the smaller 'niche markets' are as good or better than the big guys.
Maybe sign up for offervault to get the names networks you want to apply to based on the offers that they carry.
Firstly, I strongly believe that all of the niches you can find make money. Seriously, you see the same ones on every affiliate site and if they didn't work, they wouldn't keep putting them up there.
If you believe in e-cigarettes, if you believe that through whatever channels you try for you can reach smokers who would like to try e-cigarettes, and you believe you can get enough 'buyers' to make your spend profitable (eg: $20 on ads and $30 in sales) ... then e-cigarettes are the niche for you.
Well, within reason - you've then got to turn your faith into facts via testing.
Second, because I'm only in the very early stages of my affiliate marketing 'career' - I have a lot of background experience from working around brilliant world-class affiliate marketers, but the devil is in the details. I'm not yet confident that I know the niches to move into if I gave you advice I could be steering you down the wrong path (every niche makes money, just got to figure out how).
Your best bet to have real experts teaching you the answers on where & how to get started is probably something like warrior forums.
Also, check out Mike Colella on mixergy http://mixergy.com/mike-colella-adbeat-interview
Edit: Seriously. Tweaking your search algorithms to the detriment of some providers and to the benefit of others is one thing (that Google does now, and which they won't be sued for). Deliberately removing a direct competitor with as high a profile (and deep pockets) as Facebook is a different kettle of fish.
Google owns 84% of the search market globally (http://marketshare.hitslink.com/search-engine-market-share.a...). That is considered a monopoly as far as Anti-Trust laws are concerned.
I realize Google couldn't ban Facebook, and that they'd be sued for that, but I do find it funny that the opposite is completely okay. Is Facebook not trying to become a monopoly ad provider on its own site?
Google is a search site and purports to have close to every publicly available(i.e not banned in robots.txt) page indexed. Delisting a very popular site(will be doing that for the first time) will get it into the news for the wrong reasons. And how much will it hurt Facebook? Barely. How many people signup for Facebook that searched "Best social networking site" ? It will actually hurt them monetarily so it will be hard to sell to stockholders. I see almost zero chance of this happening.
On the other hand, Facebook's value is not in showing ads, it's about social networking. How will removing Google ads hurt it? Will it kill off enough FB applications for people to take notice and leave FB for... what? Orkut? Google Go? Myspace?
After all, the FB applications use Facebook's resources, so they want to indirectly charge them for it while making money.
Historically, Yahoo trumped itself as having the best search results thanks to human curation of its search directory. Bing, even today, labels itself as a "decision engine".
Google as far as I know has no public statements implying that there's a 1:1 correspondence between the set of possible Google results for all queries and the internet. This relationship is far more important than merely a 1:1 between index and internet.
Ok, I can understand that. So, what if all results from *.facebook.com were moved after the first few pages of google's results for the relevant search terms?
Would that be enough for an antitrust lawsuit?
As for the target group of users we are discussing, it would have virtually the same results.
Similarly in the mobile space, even though Google is in head-on competition with Apple, they still develop iphone-optimized versions of their apps. That's just good business.
Just the same way Microsoft won't make Google/Apple products not work on Windows.
Facebook, on the other hand, is based on the users voluntarily and involuntarily (through friends etc) providing their information and isn't so discreet about it's attempts to leverage this data to profit.
This is known even by non savvy users (personally, I've met a lot of non technical people that were worried about Facebook's collection of data with regards to personal rights/privacy, but haven't once heard about Google's tactics) and has bitten them before, e.g. Beacon.
So I feel that Google won't be stigmatized by such a move, considering it's against an opponent perceived by the public as more evil.
Should be a piece of cake. :)
may not be so easy
I didn't see anything prohibiting Facebook from selling that information to headhunters, er, recruiting firms.
On Facebook's part, they shouldn't be using a "certification process" to try and exclude competitors from making money from their app ecosystem. From what I can tell, the developers trying to make a living creating apps and even the Facebook platform itself can ill afford this sort of disruption right now. This sort of action will hurt the developers who invested in your platform the most.
On the Google side, they should be thinking about how to structure some sort of revshare agreement to help app developers get back to using Adsense and getting on the list of networks blessed for Connect sites.
Concerning arbitrary and unexplained actions, participating in Adsense alone will get you subject to more than a few of them. Consider what will happen to you as a publisher if you share your eCPM or a screenshot of your Adsense account.
And the same thing with advertisers when they have their creatives pulled for no apparent reason.
In other words, both sides use bully tactics when it suits them, and in this case, a peace treaty would probably be more mutually profitable than a prolonged slugfest.
But it's not like corporate egos haven't fueled destructive behavior before...
When HTML came out, it was purely academic. People said sure, it's cool, but how could you ever make money from just text with pictures and little links?
Now we have the answer: you create content -- text, video, pictures, games, etc -- that actively interacts with the user. Then, if you're smart, you make it so they have to "visit" your site to see this content, and, once there, they can only see whatever you choose. It's called a walled garden. All is beauty and loveliness. As long as you stay within the walls and don't piss off the gardener.
But this idea of "visiting" a site is only there because people type some text into a navigation bar and the browser loads material from a certain server. There's no reason or law that says I have to type in an address -- or that once I type in an address I am limited to seeing things from one server only. There's not even a reason I should see the information in some certain format or another. Why not type in "weather" and see various weather forecasts put out by various sources? After all, I want weather, not Joe's weather or Amit's weather. With all due respect to Joe and Amit, weather is weather.
Google is already doing this, of course, but only as a gateway. And they've got their own walled garden they're working on. Play by the rules and you'll appear on Google -- exactly where we want and alongside ads we feel are relevant to your page (and ads we make money from)
But what if you took the "location" idea completely away from HTML? Then you wouldn't be "visiting" anybody's site, and there wouldn't be any gardens to build. What if you simply interacted semantically with your computer and it gathered information from various sources and condensed it into plain text for you to consume? Gone would be "site stickiness", "addictive gaming", and "landing pages" and all sorts of other nonsense that's grown up around the idea of internet locations.
You could still consume multimedia and interactive material, of course, but only under terms you set, not terms the various site owners set. Perhaps you would want no ads, or no hyperlinks, or a time limit each day that would be acceptable for you to play games.
This puts the user back in control of their internet activities, the way it should be. It destroys many business models, but the internet is data-based, and it must evolve. I do not want the same internet in 2050 as we have now. It also gets back to the true meaning of HTML -- separating the data from the presentation. The designers of HTML realized that the purpose was structuring the data so that it relevantly linked, not creating a walled amusement park in the form of Facebook.
The curating and presentation of data is inherently a personal matter and best not left to others. We either fix this problem or it will continue to get worse, as recent events keep showing.
Now imagine if the pics were distributed on Facebook, Flickr and Picasa along with a few tweets that I had made and pics added via TwitPic. Do you still think Facebook.com is what you should type?
Now think of a setup where the thing to be typed is "username: pics of the part last night /twitter facebook flickr picasa"
Gone is the idea of any advertisement and revenue model based on the content's location/web page.
The reason they screw developers and consumers over is because of the way we access the internet, using a browser, an URL, and a single-site "visit" metaphor. We are programmers, though. We are free to redefine how we access the internet any time we like. We have created our own prison.
We can do better than this.
The problem isn't just programmers creating their own prison though - it's about business models. How do we create this seamless brand-free info sphere and still get paid?
But it is a different question than "how did we get here?" which is the question I answered.
If we don't know how we got here, or what the nature of the problem is, how can we ever expect to solve it?
Certainly this would be an interesting world to live in, but so far the only entity which has enough processing power to figure out what you want and act as your intelligent agent is, in fact, Google. Even with Moore's law it might take a while before everyone can have a googleplex in their iPad.
That, of course, is a long, long way from here. But I don't think we need to boil the ocean. Fact is, you could make 10 or 20 categories of things folks do on the internet and cover a huge chunk of activity. As one commenter pointed out, lots of folks want pictures of folks from the party last night, not "facebook". There's no reason you couldn't have a handheld device (or program) that you pushed a button and it showed you recent pictures from your friends -- no matter where they posted them online.
If you wanted to get ambitious, you might could come up with 100 use-cases that would cover an enormous amount of online activity: checking my account balances, hearing from friends, sharing pictures or videos, providing feedback on what I thought after consuming some kind of material, etc. I'd be willing to be such a list would be so complete that's it's not important about the remaining items. You'd simply use a browser and an URL for those.
I bet you could create a device with 20 or so buttons that would cover so much common activity on the net as to make the device useful as a stand-alone appliance.
The beauty of this, of course, is that since people's behavior is more or less unchanged (people have been sharing pictures with each other ever since there was photography) the same buttons could be easily learned and would work no matter what the underlying technology or transport mechanism was.
Why would you build it as anything else than an online service (as the person building it)?
First, legally you can't use one online service to aggregate from other services -- every walled garden has clear TOS that prevent this. You can, however do the gathering and processing locally. After all, you own your own computer equipment and are solely responsible for how data is collected and presented there.
Secondly, and more importantly because of the history, you're trying to solve the problem using the constraints and assumptions that created the problem to begin with. You can't fix seven walled gardens -- by creating yet another walled garden.
Stand-alone targeted web apps are great for finding needs and servicing markets, but the nature of the net is monopolistic. That's why many of these stand-alones end up getting flipped. We need to break the technical backbone that keeps creating monopolies if we really want to get rid of them.
Why should the user be in solely in control of how a content producer's material is consumed? The vision you reference scares me a bit: We've already got a "race to the bottom" among manual laborers in the world, now we're looking to dedifferentiate and disempower our content producers as well? If I put effort into writing a movie review, I think it's reasonable to expect some control over how it is consumed (e.g., people look at ads that benefit me, pay me, or maybe just come look at my website with a pretty picture of my face to make me feel special).
Don't get me wrong: I like having some freedom in how I use content. I like having my music unencumbered by DRM to use on any current or future device I might buy. I like using Google Reader to keep my finger on the pulses of all of my hobbies. But I also sympathize with publishers about the Kindle DRM (and laud Amazon's attempts to make my Kindle content available on lots of platforms and devices) and with websites that just put a quick blurb or title in their RSS feed to force me to come to their site if I am interested.
Sadly, I haven't yet heard a proposal for how content should work in the future that strikes the right balance. We seem to have publishers pushing toward extreme inflexibility and "freedom" advocates pushing towards (what you describe) a situation that diminishes any benefits (financial or otherwise) of content production. I hope we can find a way to empower content producers while providing users with flexible (though, probably not entirely unencumbered or "free") ways of consuming content. The status quo, even with its annoying ads and restrictions, seems better to me than either of the extremes.
What incentive do people have to create content with such a system? Altruism is fine, but content creators need to pay rent.
I worked on something a little while ago that was similar - allowing people to mash arbitrary content together - but abandoned it because of the hassle of trying to prevent it being used for leeching.
Result, an army of angry developers, Google loses a lot of clients, a war has begun between two of the biggest web companies.
If so, it would be extremely uncompetitive :)