Thursday, June 30, 2005

In praise of MS and Yahoo

Longtime readers of this blog (which, as you all know, consists of pretty much no one) know that I have an affinity for Google and Apple above Yahoo and Microsoft. It isn't just the obvious stuff, like the fact that I have great taste and an arrogant intellectual elitism. It's just that A&G get me as a user at a really deep, emotional level, and Y&M don't. I don't know how to explain it any better than that. No kidding, I really don't. That's why I'd never make it as a writer.

Today, though, Y&M did some stuff that tickled my fancy in a way that I didn't expect, and I wanted to signal my surprise that they did something right.

Yahoo first. Yahoo announced MyWeb 2.0, a "social search engine." (More coverage over at John Battelle's place.) Now personally, I love this idea. I love it, in large part, because I had it a couple of months ago. I don't have any excuse for not doing it myself, actually. Well, I have several excuses, none of them particularly good. But they're doing a good job of propping up my fragile sense of self right now.

Here's the idea- you go around tagging webpages, just like you do with You combine these tags with a social networking setup, and what you end up with is a personalized, bottom-up version of, which is pretty cool. I like it. I like Yahoo showing up with something really cool and innovative, and, dare I say, genius. So, that being said, let's try to tear them down a bit.

I think the obvious concern has to be whether the social search engine can overcome that great deterent: human laziness. There are just not enough natural-born librarians in the world. The really good natural-born librarians are well paid for it, and the ones who aren't natural-born librarians (but really wish they were) are kind of scary and don't have many friends, which is antithecal to the concept of a social network.

The problem with social networks that require some work by the individual users is that many more people are consumers than producers- see, for instance, Gnutella. I would solve this problem by offering people an incentive to build out an index- give them a cut of the text ad revenue that gets generated whenever someone does a search on their engine, or an ad is generated off of a link that is incorporated into results because of an entry in their index. This has the downside of increasing the likelihood of click fraud (not to mention having to share the profits- oh my!), so I don't know if it's worth doing if the network can grow on its own, without the incentives. But it might be something for Yahoo to keep in mind, should MyWeb 2.0 stall.

Personally, I think they have a great shot, and this could be a hugely useful thing. It wouldn't surprise me at all to see Google buy in the next few weeks and make a similar move into social search. This will really be fun to watch.

As for Microsoft, they didn't actually do anything of note today. They had some little thing with an extension to RSS that was generally considered to suck, but at least they're making an effort. Instead, my props to MS is based on a blog entry by our old friend Scobles. This is going to be a bit of a thing in the tech blogosphere over the next couple of days- in fact, it's already started. I generally read Scobleizer to check out what the most delusional (and therefore interesting) employee at Microsoft is currently thinking. This particular post is Scobles' plea to BillG to kick out another note about collaborative and social software on the Internet, along the lines of the famous 'Tidal Wave' memo.

Scobles' post is primarily about an "Internet Content Sharing Suite," a unified set of applications with a common interface for blogs, podcasts, photo sharing, wikis, etc. I think Scobles was foolish to present the approach this way, since it's just guaranteed to set off alarm bells in people's minds about MS taking over the Internet or whatever, and I think you see that in some of the early reactions he's getting. But once you get past that, it's clear that Scobles gets what's going to happen in this space over the next year or so, and that really makes me believe that there are at least a few other people at Microsoft who get it, too. I could be wrong about this, it might just be Scobles screaming in the dark over there (this really compelling blog makes me wonder), but if I'm not, I think the world of collaborative software is about to get much more...evil, for lack of a better word.

Wednesday, June 29, 2005

Profit per Byte

I have this thing for Jim Collins- the guy who co-authored Built to Last and Good to Great. It's a little unusual, and I don't like to talk about it- my fellow engineers sort of look at me funny when I talk about business stuff, but I can't help it. I find it all really fascinating. We have all of these buzzwords and frameworks and processes for people who want to make business seem more interesting than it really is, but I've never felt like that stuff was required to make business interesting. That's not to say that Collins' isn't guilty of this sometimes, but he's better than most.

One of the things he talks about in Good to Great is the "Hedgehog Concept", which is modeled after some fable about a fox and a hedgehog, or some such thing. The real idea underneath the packaging is a focused understanding of what drives a company's bottom line, and how that understanding drives everything a company does. Collins argues in G2G that one way to really get at this core concept is to think about a core profitability metric- something like profit per x. For some businesses, this is profit per widget, and for other (more service-oriented) businesses, it is profit per employee. Walgreen's is a neat example, it's metric is profit per customer visit. The book goes into all of this stuff in more detail, but I wanted to focus on the web, and compare two different profitability metrics that I think are in play: profit per pageview, and profit per byte.

The profit per pageview model is what drives the vast majority of websites today. The basic logic seems to be that whenever a user should chance upon a page within your site, you should throw as many ads at them as you can possibly squeeze onto the page, in the hopes that something might get a click from the user. It is, with differing degrees of subtlety, the model that drives Yahoo!, eBay, Amazon, and most of the other old-school Internet properties.

Google, on the other hand, has to be the prime example of the profit per byte (PPB) model. Maximizing PPB has a number of implications, which can be seen throughout the Google empire:
  • Lightweight webpages that avoid big graphics and complex HTML,
  • Text ads that take up only a few bytes, as opposed to animated banner ads,
  • AJAX-based websites (like Gmail, Google Maps) that don't require the user to download the same bytes over and over again- only the information that changes
It's interesting to me that while so many companies have started copying Google's look and feel, their computing infrastructure, their work practices, etc., there hasn't been much discussion of copying the business model that drives so many of these decisions.

Post hoc, ergo propter hoc

Today was a good day, and I just wanted to blog it a bit before I talk about some other stuff that's been on my mind lately. First, you probably noticed (and by you, I mean the one person who reads this thing, other than me) that I haven't posted in awhile. There's been a few reasons for this, most of them having to do with me being really busy on this project at work. But it's sort of winding down now, and I have some time (before the next project begins) to step back and reflect on the technology industry as a whole. Someday, I hope to have enough time to sit back and reflect on my life as a whole, and the way things are going right now, that should probably be soon.
So, you know, that's why I haven't been writing. Spending most of my time listening and thinking. A couple of recent events spurred me to try a little writing again, and here they are, in no particular order:

  • The death of Neal Pollack: In case you didn't see it (and unless you read Eschaton pretty frequently, you probably didn't), Neal Pollack died ** the other day. I remember getting Neal's Anthology of American Literature back in my senior year of college. I read it when I was on the plane out to Austin for a job interview, and man, I laughed my ass off. His death reminded me of the incredible joy I used to find in the written word, and its power to make a grown man wet his pants in row 24, seat F.
  • The web became really interesting again. I use the web every frickin' day. It is a struggle to tear myself away from my laptop. It's probably unhealthy. And so on and so forth. But because it is so ubiquitous, I don't really think about it as something that is interesting in and of itself anymore. But that's changed lately, and it's primarily due to a new online crowd I've been hanging out with. Less of the political stuff, more techie. Back to the roots.
So that's my story. On to the substantive things.

** Neal didn't really die.