The Problem With Portals 128
nickfarr writes: "This article about Yahoo from Sunday's NYT gives some pretty good arguments against the profitability of portals; or the idea that massive visibility translates into massive profit. It definitely presents a broad middle perspective between the .com naysayers and the irrational optimists." The financial news is full of such things, and this is better than most -- all that infrastucture is looking for some money to swallow before it starves.
Anipike.com - A 'portal' the way it should be (Score:2)
There is a need for 'link lists', however. Anime Web Turnpike, and Anime 'portal' of sorts is a good example of this:
http://www.anipike.com
Anipike neither charges nor rewards users for inclusion on its lists of Anime-related sites. It makes money by targeted advertising. The people who advertise on Anipike are online stores or websites that sell Anime related goods. (You never see a porn ad on Anipike unless it's for an ecchi game or something similiar.)
Anipike also doesn't do anything to 'stick' a user to its pages like other portal sites. They count on the fact that they are such an invaluable resource to people trying to get a Dragonball or Tenchi fix that they will come back.
They don't market their site, instead counting on word of mouth and thoughtshare to build a powerful presence. If you have an anime site and you're not trying to get it listed on Anipike.com, you don't care about getting your stuff seen.
By taking this targeted, intelligent approach, Anipike is a pretty successful little portal. I just wish others would take their example.
Trim the fat. (Score:2)
--Greg
Re:TANSTAFFL? (Score:2)
Re:yahoo (Score:1)
frankly (that's a pun), improper use of the word "monetize": it does not mean "financed" or even "monied". It refers to cash money as opposed to money in other forms such as investment, savings and credit.
Re:i think the problem... (Score:2)
It always seems like the .coms going bust are the ones that got huge too fast. I guess you wave millions in VC money in front of people and you gotta spend it. Then if you seem successful, you gotta expand to 'grow' to please the investors, etc.
Seems like many .coms doing OK are the ones that are a) living within their means and b) doing what they do best.
--
Re:yahoo (Score:1)
Re:don't believe the hype; kill all pundits (Score:3)
Dream on, marketroid. Hate to burst your bubble, but that is exactly what all of the major ad network players do, or at least purport to do. Companies like Accrue and NetGravity made millions of dollars selling ad-tracking, targeting and reporting software to various portals (now all dead or dying) in order to ensure the delivery of that information.
Guess what? All the targeted demographic information in the world doesn't do a damn thing to change some very basic facts:
Re:don't believe the hype; kill all pundits (Score:2)
On the other hand, television and radio don't have the problem of their costs scaling with their popularity. If ten times the expected number of people tune in to the superbowl, the network will still turn a profit and will make a note to up their advertising rates next year. If ten times the expected number of people turn up at a portal, there's a good chance people'll be getting 503 errors left and right and all hell'll break lose.
Re:Portal Feature Bloat (Score:1)
Re:Something the stock investors failed to underst (Score:5)
It's funny. I worked at a bank that passed on the Yahoo IPO back in 199x. There was a lot of e-enthusiasm among the analysts, but it had not reached the flaming inferno of the past two years.
The primary (overlapping) criticisms of the deal at the time were:
Time seems to have confirmed these worries, and it won't be long before we hear a chorus of "I told you so" from the despised minority of doubters. Incidentally, the ability to enumerate these points did NOT save my old co from its share of internet flameouts. I guess that's why they call it a mania.
My own opinion is that the shakeout is a good thing. Most "e-tailers" are glorified catalog retailers, except that they lack basic business knowledge. Throwing people's savings at them is hardly a good thing. If other online cos that parted these fools with their money have to suffer some, that's good too. Let them shed the corporate massage parlor, or whatever other .com fat they've accumulated. Let them automate more, as computer businesses should, and return workers to the Pool of Useful People.
The worst thing is the media trying to turn this into MY problem. I can't stand it when these business issues cause people (particularly the Times) to darkly hint at the impending death of free content. Don't they think some struggling free content provider might be happy with Yahoo's "80% discounted" ad placements? Might they not benefit some from the many skilled workers returning from their mad crusades?
On a grander scale, follow the money upstream -- do they think when the tap runs dry, infrastructure and bandwidth providers will just pack up and go home? Nonsense. They'll do what the computer industry always does when faced with a glut -- increase capacity and lower costs until you find your market again. The only rational conclusion is that the removal of .com high-rollers from the marketplace is the best possible thing for the free and independent Internet.
Sorry, I should've warned about rant mode, but it took me a while to get worked up.
Re:TANSTAFFL? (Score:1)
Question is answered in the NYT (Score:1)
The NYT article points out that Yahoo charges *more* per view than the bus ad you mention. The question is whether that large premium is justified. No one is claiming that banner ads are useless compared to other ads, just that they might be worth no more per viewer than a highway billboard. And if they are worth only the price per view of a highway billboard, then Yahoo is in trouble.
Re:slipped in popularity? (Score:1)
Yeah, and I hereby declare the NY Mets to be the winners of the 2000 World Series, because they were at a disadvantage because of all that money that George Steinbrenner was paying to the Yankees. Sorry, but excuses are for the weak, not the winners.
What difference does it make that Yahoo focuses the "main page" of its portal on its search engine? The tone of your post makes it sound like this is a good thing, although I'm not sure why it would be a positive or negative. Please explain.
Cheers,
Re:i think the problem... (Score:1)
Not without significantly damaging their image/brand value, I don't think. And as far as I remember Yahoo became quite a name on the net before they got into all their side ventures, so you can't say that they would have lacked brand power without them.
And much of the problem right now is that high traffic can be a liability if nobody is paying for advertising.
Not as much of a liability as keeping more people on staff because of unprofitable ventures. A skilled programmer on staff can run as much as $90,000/year with all the benefits thrown in. At current prices, you could probably get quite a bit of hosting time with that chunk of change. Consider Yahoo's current staff size and the amount of people it would take to run a Directory only site. I think that the cost would be much greater than the decrease in revenue.
Re:The problem is the scope of the sites... (Score:2)
The CD, DVD, VHS stores make sense for Amazon. They have a huge amount of "shipwidth" (warehouses, etc.: the shipping and receiving equivalent of bandwidth) that's fixed cost. To add small things like that to the books adds almost no marginal shipping cost (the warehouses have to be staffed and have their power bill paid whether Amazon sells just 10,000 units a day or 100,000 units a day. It makes no sense to waste that bandwidth.
It's the same reason that people hook up five computers to a DSL/Cable/personal T1 connection. With the exception of Napster and the like, there's no common use of the 'net that will actively flood a fat pipe like that. So you set up a computer in every room. It takes away relatively little bandwidth, and you get added convenience. The only barrier is the startup cost: even buying a $500 K6-2 box for every room gets expensive after a while.
Perhaps what Amazon should do is extend the zShops concept and rent out their warehouse space and shipping services to smaller e-tailers. Amazon could charge $300/month and manage the store database, all the client has to do is ensure that Amazon is provided with sufficient inventories to ship.
Re:see also: (Score:2)
IMO, supermarkets succeed in the US because they offer convenience, transportation-wise. It is a hassle in our car culture to drive to and park at the produce stand, then the butcher, then the bakery, etc. We find it easier to drive to one place, park, and get all of our shopping done ONCE. Contrast this with many European cities, where the various speciality stores one might visit are densely located around your home. There is almost no cost to visiting the produce store, butcher's shop, and bakery separately when they're next door to one another. The web is like an urban shopping environment -- i can instantaneously switch between pages at different sites. There is almost no convenience associated with different pages being hosted at the same versus different sites.
And just as there are advantages with shopping at different speciality stores -- there is a wider selection of better-prepared breads and pastries at a bakery versus a supermarket -- one tends to get better content in area A from a website devoted to domain A than one spread over A-Z. (For example, as a native of Chicago, I prefer to read the chicagosports.com to cnnsi.com and espn.com, let alone the stuff available at the more general portals.)
Re:Here's a question (Score:2)
What the advertisers don't get is that it's having the effect you describe--it's so ubiquitous that nobody notices any of it any more (sort of like the 1-800-GAMBLER signs in the casinos).
[1] There is no self-serve gas in NJ.
Yahoo is the thermometer of the Internet (Score:1)
Yahoo is like the thermometer of the internet, because it's very survival relies on the wellness of other web-based companies and the general public at large. If companies aren't doing well enough to advertise on the Yahoo network, even in these times of dirt cheap advertising rates, Yahoo's bottom line will reflect it. Notice how many Yahoo banners are on Yahoo's own pages.
Ditto for websurfers. If the consumer dosen't feel comfortable in this economic climate, they're less likely to click through Yahoo's many affiliate links and buy something, or use the Auction service for example. Bub-bye commissions and referral fees.
As long as the net writhes with the dotcom flu, Yahoo itself will show signs of warning.
Re:Trim the fat. (Score:1)
Re:don't believe the hype; kill all pundits (Score:1)
Look at what television has become today. Television is nothing more than a sequence of shiny pictures telling what we should buy. The television news media is bad, the programming is bad, the commercials are annoying as hell. There is absolutely no content left; it's all been marketed and advertised and sponsored away.
I think we should be vigilant about keeping the Internet from digressing into the mind-numbing idiot box that television has become.
Perhaps killing it off in the 1930's wouldn't have been such a bad idea.
Re:see also: (Score:1)
You have never been there, have you?
-m-
RE: The Problem With Portals (Score:1)
Re:Availability != Profitability (Score:1)
Although they are evangelists they are not, "rolling in billions of dollars." They are people that work like everyone else. They don't ask for handouts, although they do accept them. I don't know any of them that own gold thrones with velvet seats.
As far as Bible publishing goes, it's the all-time best seller, bar none. It continues to generate top sales, almost seventeen hundred years after being canonized.
Re:don't believe the hype; kill all pundits (Score:2)
Ok, so there may be some truth that that phemenon, but that doesn't mean that you shouldn't speak out against irrational behavior. Did you ever consider the side-effect of the DotCom hype? *Real people* put *real money* (or resources) into these firms. When that happens, a) Those people can (and have) lose a lot of money. b) That takes resources away from other ventures, particularly in technology.
So what? Ok, so Yahoo's financials may be a bit better than their competition. This doesn't mean it's a sane investment as 10 billion dollars. It doesn't even mean it can survive. Entire industries CAN (and have) effectively die. Anyways, I'm not a day trader. You want to see something interesting? Notice how quickly the institutional investors have been moving out of the DotComs.
What justifies this belief? How much income will they gross over the next 10 years (in your forcast) and when are you predicting it? What kind of margins? What does their overhead look like? Cash flows? These are the kinds of things that "real" investors look at, not just a vague assumption that because the idea sounds acceptable that a company in the industry must be acceptable, at any given market cap and/or PE.
That would have depended on the valuations and the companies.
As for the age, that's exactly my point. It is just 7 years old, an infant, yet you're effectively betting a large sum of money on it without considering the bigger picture. That as time goes on, the players can change. Or that, even if the portals turn out to be "good", that's not necessarily good enough to justify a valuation in the billions.
That said, I *do* believe some people will make some respectable money using the internet overall. But, before that can happen, the industry and involved parties (i.e., the financial community) *needs* to *FULLY* come to its senses. As long as you have an insane valuations (which they still are), you're not going to find effective companies and you're going to have a hard time making a decent return on your investments over the long term (as opposed to, say, the venture capital/invetment banking community turning over DotComs to the ignorant public...and making a killing). This is not too unlike the BioTech crash in the early 90s. Many are starting to come back around now for IPOs and the like, the DotComs are not too disimilar.
Unusual business model! (Score:1)
The SeeThru website was originally launched to tie-in with a (rather crap) British TV drama called (wait for it) "Attachments", and set in the heady world of dot.com startups (or, seemingly synonomously, the heady world of Hoxton!). The attention to detail is rather touching, and it's fairly impressive that they've kept it running now that the program is no longer on the air.
I believe Attachments is due for a second series in the spring, so presumably they'll just take up from where the website has currently got to in 'real life'.
The whole thing is funded by World Productions [world-productions.com] I believe. I wonder if they do venture capital...?!
Re:i think the problem... (Score:1)
Me: But if being just a web directory is a good thing, they still have that option, don't they?
Not without significantly damaging their image/brand value, I don't think.
Hmm. They can toss anything they want, just as long as it isn't stuff I use.
And as far as I remember Yahoo became quite a name on the net before they got into all their side ventures, so you can't say that they would have lacked brand power without them.
Perhaps. I would counter that without the appearance of growth, their early position would have faded over time. There were certainly a lot of Excite's out there gunning for Yahoo's place. Maybe they overextended, but I certainly couldn't have done as well as they did and I have a hard time believing that all the critics in this discussion could have done so either. Especially the, "Yahoo should be 4 or 5 coders and a web host" types.
Consider Yahoo's current staff size and the amount of people it would take to run a Directory only site. I think that the cost would be much greater than the decrease in revenue.
Interesting conjecture. What I would like to know is how many people use www.yahoo.com (i.e. Yahoo the Directory) as their homepage vs. the number who use my.yahoo.com (i.e. Yahoo the Customizable Portal).
Anyway, Yahoo certainly has all the numbers they need to figure out what to keep and what to toss, and I think they still have maneuvering room.
Banner Ad Effectiveness (Score:2)
The problem is that five years of experience shows very limited value for the sort of ad that Yahoo and other sites sell most -- the ubiquitous rectangular banner. Those banners, it seems, are not as entertaining as TV, not as informative as print and not as personal as direct mail.
"A banner is nothing more than a highway billboard, a reminder message," said R. V. Hopple, CEO of Unicast, an advertising technology firm. "We know what outdoor is worth -- $2 per thousand." By contrast, prime-time television advertising sells for $17 per thousand audience members, according to The Myers Report. Yahoo recently dropped its list price for general banner ads from $16 to $8 per thousand impressions, although ads in certain high-demand places can go for as much as $80 a thousand.
The problem is that, when Banner ads were novelties, they had more value. Now they are common place, and their value is dropping. It will probably level out at the bill board level or slightly higher.
Re:see also: (Score:1)
I made it a point to say that portal sites who's site do not share a common theme are worthless, a supermarket shares the theme of 'food' - some portal sites have no theme at all, and thus - poor uniform demographics. -Largo
Excite@Home (Score:1)
But I think Yahoo! is far enough ahead in the portal game that it can afford to wait to see if a marriage like the one between Excite and @Home Networks actually works out. The verdict's still out.
--
Re:don't believe the hype; kill all pundits (Score:2)
The visionaries in the first paragraph you quoted, are the same types of visionairies and pundits who declared dotcoms to be "the next big thing." Everyone wanted to find the next Microsoft, and this lead to the gross overvaluations you describe.
The concept of the internet land-grab is essentially the same scenario, and it worked (yes). Some people did get lucky, and many didn't. That's part of the game, and they willingly played it. But I challenge you to show me how Yahoo will not survive until the market shakes out, barring the kind of mass panic that the pundits seem hell-bent on creating. They have some of the best web properties, and I believe that the advertising models will work out just as they have for other media.
Beyond that, I don't really care that much about defending Yahoo, particularly. I own no stock in them, and I couldn't care less about their market capitalization, stock prices, earnings, or any ratio thereof. And even if they and every single other dotcom did go under, do you really think the web would simply disappear?
No, life would go on, there would still be jobs for coders (although maybe not as many for web designers... pity there :P), and I would still be able to use the internet for everything I use it for today. the late nineties would sinply be a page in the history books, that's all. Biotech didn't stop advancing because some stock-prices did. Oracle didn't die because their "network computer" failed to catch on. And it is well with my soul.
If only the people shouting at the top of their lungs that the end is near (who were the same people who shouted how ecommerce was the ultimate answer to life, the universe, and everything) could just take some prozac and calm the fuck down, the world would be a much saner place.
Don't they know it just doesn't scale (Score:1)
It doesn't take a genius to know that as your traffic increases so does your cost... and your users arn't going to see more adds just because more other people are using it. You are still stuck with 2 very close linear functions.
de facto web directory (Score:2)
Your bank fucked up, massively (Score:2)
Your institution would have had at least two good years of yahoo stock sales to fill its coffers beyond your dreams...yes sir, you and your institution FUCKED UP MASSIVELY by passing on yahoo.
Re:don't believe the hype; kill all pundits (Score:2)
The pundits are at it again. They hype a technology that is the be-all and end-all of personal computing (but wait! the personal computer is dead! oh, different pundits? nevermind...), or it could be if you'd only give them a bunch of money. It's just insane, I probably should be worrying about it so much, but man, it bugs me.
don't believe the hype; kill all pundits (Score:4)
Yeah, and these "television" and "radio" methods of distributing content will soon die fiery deaths because they cannot force joe sixpack to make micropayment or monthly subscription in order to watch NFL football.
Don't sell your Yahoo stock yet; Net Advertising is still maturing. When sites can provide their advertisers with target demographics and an equivilant to television ratings, the current web models will work. Just give them time.
Re:see also: (Score:1)
you're absolutely right, btw.
no such thing as clickthrough IRL (Score:2)
but essentially I agree with you. don't give up on the advertising-revenue model yet. the thinkgeek ads are a perfect example of how banner ads do work. I've clicked a couple of them, but even if I couldn't click on them, I still remembered their site, bought a few christmas gifts there, and have been pndering one of those 20 gig mp3 players.
don't believe the hype. ignore the pundits (maybe even think things through yourself..)
Re:Availability != Profitability (Score:1)
Damn, but I can't remember any of them, it's been over 10 years since I worked in a bookstore. I do remember that there were 2 or 3 publishers that we got most of our bibles from. They published bibles, Christian self-help, and Christian fiction. Yes, they were specialty publishers, but larger than most.
One minor fact that I always found interesting. When we did our physical inventory, and compared that with the inventory list on the computer we got a pretty good idea of what our "shrinkage" or loss was. Guess what section was hit the hardest? Bibles. The book itself says "Thou shalt not steal" (Well, if it's the KJV it does) so I know nobody would actually steal it. I guess they just walked out the door by themselves when we weren't looking.
Hate to say it, but... (Score:3)
The key to all of this is that Holy Grail of the Internet which *no one* has ever figured out: micropayments. Yahoo!, however, could actually make some money on a limited subscription model. There are a few services on Yahoo! that I'd be willing to pay for; I use them constantly. I pay $110+ for my Internet connection at home; if I needed to pay $5/month for all the services Yahoo! provides, then I'd probably be willing to do that.
In the meantime, though, banner advertising won't pay all the bills. I work for Superpages.com, and a large portion of our income is actually from selling listings to the same folks who buy yellow pages advertising. Advertising will have to get smarter and leaner if it's going to continue to be a major Internet revenue stream. It'll have to be more than that, though. Look at the folks on the Net who really are making money hand over fist: porn sites. And while there's lots of free stuff out there, yes, quite a bit of it is for-pay. The trick is to have a service worth it, whether you're selling porn, yellow pages listings, or My Yahoo!.
No, the Net will never become completely pay-as-you-go, thank goodness. But we're all going to have to learn a lesson we should have learned a long time ago: TANSTAAFL.
The place for portals (Score:2)
The trouble with online ads. (Score:2)
The advertisers realise that they aren't going to force you out of your seat, instead they're playing the game of brand awareness. They raise the profile of the advertiser. Go to the store to buy shampoo, are you going to go for the one you've never heard of or the one advertised by the Friends star in 30 slots a night? Chances are the latter.
Applying this to the net it seems that most advertisers are too keen to try and drag you off to another site. The click-thru is the online equivalent of getting you out of your seat and down to the mall. Thing is, you're comfortable in your seat, so why move? That's why click-thru rates are so poor.
Advertisers would do well to treat their online advertising as they treat their conventional ads and focus on building their brands rather than the quick sale. The likes of Yahoo! can aid this by helping the advertisers get a better sense of the demographic they can bring to them. Maybe then the big bucks will start rolling again.
Excuse me? (Score:2)
Re:Here's a question (Score:1)
You're telling us you walk around blindfolded then? You can't escape these ads. You see them, read them, and maybe mentally tell yourself "I will not buy a foobar, I will not buy a foobar".
But when you are hungry and maybe looking for something new to try, you'll RECOGNIZE that foobar amonst the dozens of other choices(from somewhere in the back of your mind) and BINGO they got you.
Exactly as web-based ads should be considered. Branding...
Re:TANSTAAFL? (Score:1)
Re:Portal Feature Bloat (Score:2)
1) Yahoo's features aren't well-integrated. Try using chat, email, and clubs at the same time without having to do multiple logins.
2) Yahoo's features aren't best of breed. You get all the functionalities, but none of them are the best in their category. I think here the comparison to MS Office is apt - with Office you get everything bundled together, but to many people WordPerfect is a better WP app, 1-2-3 was a better spreadsheet, FileMaker is a better database, etc.
To back this up: (Score:2)
The site www.hotmail.com is running Microsoft-IIS/5.0 on Windows 2000.
As far back as nov 2000(that's as far as it goes back).
I do know what the original poster was talking about tho, as immediately after purchasing hotmail, MS tried to switch to IIS from BSD(?) unsuccessfully and had to switch back.
Popular portals (Score:2)
Of course, there's also many users who don't know how to change their default site for IE away from MSN.
Sorceror's apprentice (Score:1)
Well, the sorceror has come home, and it is time for corporate america to give the hat back.
Yahoo not one of the con artists (Score:4)
You haven't tried my.yahoo.com (Score:2)
Portals Are a Valuable Service, but... (Score:2)
Given the sheer amount of electronic information resources out there, portals make it possible to navigate the web. However, the question is becoming who provides the service and what are their motivations to do so. Yahoo made a ton of money by creating valuable real estate, but there's a recession that's driving the value down--not to mention a shift in marketing philosophy. Meanwhile, ogranizations are making their own portals custom suited for their purposes. Infact, that's what I'm working on. My employer, a large university has a library that subscribes to an awesome array of electronic publications and services. Prior to installing and customizing, MyLibrary [ncsu.edu], no one on the user end had any idea what we had. With the portal, any student can get online and have access to primary resources, and invaluable tool for students at all levels. However, the university library regards this as valuable service for students, staff, and faculty. The revenue we generate from running a portal is, in essence, the increased productivity resulting from the portal.
Let's take this a little further: Let's say that the banner ad market completely collapses and no new market for advertising revenue takes it place. Yahoo goes bye-bye. Suddenly, large organizations are going to need for their members, be they employees or whatever, to be able to find things on the Internet. That means each one will want to run their own search engine and indexing service. Or, given the current trend away from 'vertical integration' in buisiness, most organizations are going to want to outsource their portal work to avoid having to support an a web services infrastructure. That means, by default we will have a subscription base model for portals. Maybe Yahoo can survive this paradigm shift, but someone will almost certainly move into this service vacuum. To be sure, the bigger corps will want to create portals that only allow their members to see what the leadership wants them to see, but there is a need for totally open portals, especially in adcademia. I could even see a consortium of universities and colleges coming together to provide comprehensive and uncensored portal services for academics.
Re:don't believe the hype; kill all pundits (Score:1)
the difference between the internet and TV is that with TV there can only be so many channels in the spectrum the FCC has alotted, and there is a huge cost associated with starting up a broadcasting station, let alone a major network.
The internet, on the other hand, lets any college kid with linux, apache, and a PC salvaged from spare parts (or simply a geocities account, to keep things yahoo-related) put his content out for everyone to see.
personally, I'm not worrying about the future of the internet.
Re:slipped in popularity? (Score:1)
I dunno, sounded like you were declaring the winner to me. MSN wins in hits. You want Yahoo to win in something, there are plenty of other categories to choose from. For example, you could counter that Yahoo serves up the greatest number of ads. And then someone else would counter, well MSN actually makes more money from their ads because their clients are larger and pay more to have their ads shown. And someone else would counter, yeah, but AOL is by far the stickiest place on the net. And so on and so on.
As far as portals go, it's like good art -- you can't really pin it down in so many words, but you know it when you see it. I don't know what Netscape looks like these days, but MSN and Yahoo just have their similarities in different places. www.msn.com == my.yahoo.com. www.yahoo.com == search.msn.com. A portal is just an aggregate of the most common things that web users do, located all in one place -- a jumping off point, hence the name.
Cheers,
yahoo (Score:1)
Something the stock investors failed to understand (Score:5)
Just go to boo.com, the failed sports closing retailer. Millions of dollars were invested in this website, yet I get a blank page unless I turn on JavaScript. And if I turn on JavaScript, the code on the page proceeds to maximise my browser window in such a way that if I were a newbie, I wouldn't be able to access the close button for my browser. The people who made these dot.coms were for the mostpart tricksters and conmen, and they fully deserved the dot.com bust. For all our sakes, don't let them reflect on our great 'Net community.
Clarification: consumer portals are the problem (Score:2)
Most companies have done a great job of web-ifying everything in their company, unfortunately, there are now too many web resources in a company. Portals can help organize that and show an employee only what is important to them.
So, I think products like JetSpeed [apache.org] and the product I'm working on, Novell Portal Services [novell.com] have a bright future.
People who just want a very simple web-experience are going to get AOL, which in effect is a web-portal for internet newbies. I also think that soon people will be able to build their own portal with a much simpler drag and drop metaphor that will be local to their machine or web-hosted in a very simple way. I don't think there is much money in doing that, but I think it will happen.
- Twid
Why portals don't work (Score:1)
google + bookmarks = "my portal"
does not give me. Hell even the best portals I have seen are more like:
(search engine + links + weather + SLOW web based email)* banner ads = "some dot com going bust"
Re:Portal Feature Bloat (Score:1)
And as far as best-of-breed, well, all I can say is they do all I expect of them. If my expectations ever change, and Yahoo! doesn't keep up, I'll stop using them. But history has shown they generally fill my needs before I even notice I have them.
Portals could make money (Score:1)
1) The ones that try and change your homepage for your browser to go to their portals suck. It doesn't work, just makes me angry to have to change it back.
2) They are going for too wide of an audience.
and 3) banner ads just don't work, which is where the source of the money comes from.
Re:Portal Feature Bloat (Score:1)
Re:Here's a question (Score:2)
All they're doing now is making sure their brand name has "Mindshare". They firmly believe that if they stopped advertising, that people would stop buying their products.
Would you stop buying "Coke" if they stopped advertising?
In fact, I don't beleieve I've ever seen a banner ad for Coke. Does anyone know why?
Later,
ErikZ
Re:don't believe the hype; kill all pundits (Score:2)
One of the things you must realize is that this hysteria essentially PRECLUDED the possibility of rational behavior on the part of management at the majority of these DotComs (assuming they were even included to do so). In other words, if you didn't play the "growth" game, venture capital wouldn't touch you. And if you didn't take the venture capital and like monies, you risk being drowned out by the cash rich competitors that essentially threw money at anything, no matter how much money they lost doing so. Put simply, it's an unhealthy market for stable competition. Though this was more true months earlier, it's not entirely false today (although they no longer have VC cash coming out the ass). Likewise, if Yahoo is still trying to maintain the illusion of being the next big thing, they can hardly pursue the more humble, but more sane, strategies that they probably should be following.
Ok fine, but realize that if you're an investor, the question is not whether or not the internet, or even a business model survives, it's the return (or the loss) on your investment. If they're grossly overvalued, even if the company performs well, you could very well still lose your shirt when it falls back to the proper value. That's my point, and I believe Yahoo is still very well into the grossly overvalued territory.
Well yes and no. No, I don't believe the internet would disappear, but the tone and shape would change. You have to realize that a great deal of the services that Yahoo and others provided to the public were essentially subsized by outside investors, if Yahoo and others can't perform at par, all of that money will simply evaporate. In other words, those services would disappear, unless they can find viable alternative revenue sources, like charging fees. Now whatever you believe about the ultimate future of the online ad, it is hard to deny that they are currently pretty worthless as a source of revenue...to the extent that companies could go bankrupt before anything else materializes. This is just a reality of a any startup, cash flows are your life line, but it's aggrivated by ignorant management at the DotComs that never has really dealt with it.
see also: (Score:3)
Largo's "Monetize" rant today at MegaTokyo.com [megatokyo.com] on why portals (and ad networks) suck.
to quote:
Re:Something the stock investors failed to underst (Score:1)
>proceeds to maximise my browser window in such a
>way that if I were a newbie, I wouldn't be able
>to access the close button for my browser
I went to boo.com now with JavaScript enabled, and nothing of the sort happened.
>The people who made these dot.coms were for the
>mostpart tricksters and conmen
Clueless web designers, quite possibly. Tricksters and conmen is being a bit harsh, don't you think?
i think the problem... (Score:3)
If they stayed in the web directory business which started them off (and which is something they are good at) they may not have needed to hire 10,000 people or have huge overhead operating costs, while they would still get much of the traffic and advertisement revenue they do now.
I think it's their greed that got them into the current mess. Low overhead high traffic sites is the way it should to go. How long would "Slashdot free internet" service last i wonder? Stick to what you know.
Salon perspective (Score:2)
For example, Yahoo does turn a profit(unlike most online ventures), and remember - all those nay-sayers are the same analysts who steered you wrong a year ago.
-wetwire
Understatement of the year (Score:2)
That Yahoo stock IPO'd at 13 bucks and has split four times since then. At $16 today, it's still worth about 16 times the IPO price. If his bank wanted to sell the stock sooner, December 1999 would've been a good time for it, when the stock was over 100 times the IPO price. The only thing I'm not understanding is why the original poster is actually sounding proud about his bank's horrible, horrible decision.
Cheers,
Re:yahoo (Score:2)
It was and always will be a bloody stupid idea (Score:1)
Second: these portal sites try to be the middle men of the internet. Duh? Come again? The one medium where you don't need a middleman, and someone thinks you can make money off that?
Third: yes, you can get stupid users to browse from and around one site. Perhaps, you can shift them off MSN, AOL, and Netscape automatic home pages. But you can't make money off them - stupid people don't get rich.
Fourth: give away the razors, give away the blades, and what were you planning on making money from? Adverts on the packets?
Fifth: production costs for information providers on the internet are higher. You've got the whole damn world to stay current with, and people will dump you without mercy if you don't keep up. Keep up meaning: if they can click to your competitor and read a thirty minutes newer story, you're toast.
IMHO (Score:2)
ISPs should take over some portal functions (Score:1)
But I think there is a reasonable chance that Yahoo! may be able to charge for their services as an "ISP add-on". However, for that to be really attractive, they have to revamp their site to be less advertising oriented and even more oriented to satisfying exactly and only the needs of their (then) paying customers.
Inevitable, no? (Score:2)
Sadly, this will continue until the Internet community realizes it cannot jump around to 'the next newest site' forever, since the service has begun to degrade to the point of uselessness... When that day comes, people will be more open to the idea of paying a few bucks a year to keep some 'core' Internet sites (like Yahoo!, CNN, CNet, NYTimes, Slashdot, etc..) open.
Of course, the challenge will be to have people voluntarily pay, so that everyone can view it for free. (after all, we're looking for educational/informational access to the masses).
Inevitable, I suppose, but when I think of local public broadcasting stations and their endless fund-raiser drives, it does make me cringe...
Re:i think the problem... (Score:2)
Rubbish. Yahoo wouldn't have a fraction of the traffic it has now if it stuck solely to the web directory business.
How many people who use Yahoo use it solely for its directory/search service?
But don't take my word for it. Look at the media metrix rankings [mediametrix.com]. The top web sites are portals. How many pure search engines are there on the list?
Re:Here's a question (Score:1)
The hard-discount shops base most of their business on selling products which carry little or no ads-induced overprice. And it works - up to a point.
IMO ads are important when you launch a new product (truly new, not like 'our new soap formula will make your linen ever whiter'). Once you have your customer base, they becomes only a reminder, for not loosing customers on new alternative products. But too much reminding can be annoying and it can generates the opposite effect (speaking for myself, there are many products I don't buy because of obnoxious and annoying ads everywhere ).
Portal Potties (Score:1)
Now there are a jillion useless portals, centered not around useful information or services, but Eyeballs (that magic number that brings in money) and Content (that junk you put between the ads to get the Eyeballs). To maximize the income per Eyeball, too many portals consist of nothing but useless paid-placement links...and find out that people tend not to stick around for that crap. Leading, of course, to mousetrapping (a.k.a. "circle-jerking"), home page hijacking [cexx.org], and the ever-popular "Browser Enhancement" [cexx.org] that will change your homepage, Search, email signature, etc., and prevent you from changing it back.
It's a shame that the more 'upstanding' portals had to be hit by the portal-potty-itis aftershocks...
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Re:see also: (Score:1)
Largo says:
Isn't this a bit like suggesting supermarkets couldn't succeed because people wouldn't want to buy meat, vegetables, and magazines from the same place?
The Future of Portals (Score:1)
Given the exponentionally growing amount of data out there.. Popular portals have a signifigant amount of power over what gets seen and what does not. Granted, people will currently still fall back on search engines if a directory or portal doesn't give them what they need, but the portal usually comes first.
Now. Is it crazy to believe that some day portals might use this power as a cash-making-scheme? A scenario where you can wait forever to get editorial review or you can pay up front and be guaranteed an immiedate spot on the portal. (Where depends on how much..) This way portals still offer links to quality content (editorial poriton), but still rake in the cash from people who don't quality content but still want to be seen.
If enough advancement of information glut takes place, space on a popular portal could be almost as valuable as air time on primetime network TV.
--Sven
How exactly has yahoo failed? (Score:2)
Besides, no one here was foolish enough to believe a portal could be worth 150 billion dollars, right?
Re:Something the stock investors failed to underst (Score:3)
The people who made these dot.coms were for the mostpart tricksters and conmen[...]
Don't attribute to malice what can easily be blamed on stupidity.
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Re:i think the problem... (Score:2)
A directory site requires little in the way of backend programming/resources. Or at least less than a classifieds engine. But because they're both "Yahoo", people expect the same pay structure - free.
So they have put themselves in a position where they have all these (arguably excellent) additions to their core service, but which can no longer be supported by the pure banners because of their increased overhead costs. And noone is ever going to pay for anything with the Yahoo brand, simply because it would seem like a rip off. After all, we're used to Yahoo being all about free goodies.
Re:slipped in popularity? (Score:2)
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Re:don't believe the hype; kill all pundits (Score:2)
We have put such a huge value on being "visionary" that everyone wants to be the first on their block to declare "the death of XXX", because with enough pundits and enough instances of XXX, *someone* is bound to be right and look brilliant. Plus, enough doomsayers create a self-fufilling prophecy. If enough people keep shouting that the current business models will never work, people will stop supporting them and Viola, they don't work!
Now:
You can say Yahoo has a P/E ratio of whatever, but they're much better than most web properties who have a P/E ratio of undefined, because they have no E!
And by the way, I don't know when you bought your stock, but you must be pretty damn lucky if selling now is going to make you any kind of money. I think it's safe to say that Yahoo's stock will rise eventually, that's the way real investors play the market. Day-traders can die along with the pundits.
Click-throughs: are not how ads worked before the net, and it may or may not work. You can't click-through billboards or radio-ads (though interactive TV is coming...), but yet advertisers still plunk down the money. Why?
I'll leave you to ponder that one...
As for the "503 errors", well, the infrastructure is still going into place. See akamai, et. al. The "Slashdot Effect" is not a major problem for most commercial sites now.
To conclude: You bastards would have dismissed Television before the 1930s were up, wouldn't you?
The web is what, 7 years old, commercially speaking. "ad-tracking, targeting and reporting software" is still not widespread, and has only been around for a few years.
Take a chill pill already!
Re:The problem is the scope of the sites... (Score:2)
a) trying to make a profit, and do it through volume
b) trying to grow as fast as possible so as to keep out competition. If they didn't sell garden stuff, someone else would.
Amazon is trying to create the infrastructure to become the online version of Target and the other large, general purpose stores.
Re:Here's a question (Score:2)
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Death of the Internet -- film at 11 (Score:4)
"At some point, if content on the Internet isn't worth paying for," Mr. Kenney said, "it is going to have trouble surviving."
I just adore this point of view, and encourage Mr. Kenney and his ilk to get out now, while the getting's good. Don't let the door....
Eva Schindler-Rainman, one of the people I admire inordinately for her work on voluntarism, and who I got to meet, said "if you need money, money is always available. Worry about making a good case, and you can find the money."
Maybe some of today's ad-subsidized websites will be tomorrow's foundation-subsidized websites. Maybe there'll be government grants (I'm surprised the UK hasn't already gone for this) that reward people for putting up information and supporting dialogue.
And while there are funding sources that love to do pilot projects and move on, other sources (a bit harder to find, but they're there) are interested in sustaining existing efforts past the pilot project stage.
People think that an order of magnitude decrease in the cash that's going into the net would be disastrous. I think that's nonsense. If we don't have Wal-Mart on the Web any more, exactly what do we lose?
Re:Portal Feature Bloat (Score:2)
Whether I have been to one or not is irrelevant. It's whether most users do. Most users do not get their apps from warez sites, particularly business users wary of getting sued. They may copy, and use the same license on several machines, but warez is for hackers and gamers, not for Joan Q. Public.
Re:slipped in popularity? (Score:2)
I wasn't making excuses for the fact that Yahoo is "losing", I was merely qustioning the methods we use to evaluate "win" or "loss".
The style of Yahoo's main page could be positive or negative, I wasn't speculating initially. However if you compare the 3 portals we were discussing, MSN.com seems to be devoted to media, netscape.com seems to be devoted to news, and Yahoo.com still features its search engine and web directory, which is what it has been doing all along.
There comes my questioning of the term "portal"--we have three sites with diverse content, yet we lump them under the same category.
Are there enough similarities, or are we comparing apples to oranges?
Re:Portal Feature Bloat (Score:2)
Actually, Yahoo's abundance of well integrated features is one of the reasons cited for their trouble with online advertising. People do everything at their site, and don't bother clicking any of the banners.
<RANT>I, for one, like integration, as long as it I'm not pressured into it, and don't have to use it. Get this... I like it when the site remembers who I am and acts accordingly. I add my work office to my address book, and it carries over into the Yellow Pages. If I want to look up the closest Chinese place next to the office, I don't have to type in the address again. And believe me, I'm very much a privacy freak. I would probably stand out even in the Slashdot crowd. I'd rather have one company know the info instead of twenty.</RANT>
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No surprises. (Score:4)
The real reason portal sites die, is that there useless. Everyone loves simple specific information and news pages, lets say a page on electric cars. However when a portal gobbles it up for their, "electric car", section, they break everything to make it fit into their own arcatexture, and in the end aliante their origonal audience by being overbearing, and often demanding a login to use.
The worst part is portals keep on gobbling up smaller services. Geocities used to have a pretty good free webhosting service, then yahoo gobbled it up. Hotmail was the defacto web based e-mail page. Untill MSN gobbled it up (and unsucsessfully tried to move it over to NT i might add). Now? Hotmail is crap. Yahoo's e-mail service, and even the home grown web-mail services many universities offer their students, beat it out hands down. Why did it happen? Because MSN demanded that hotmail fit into their own portal structure, and work with every little trinket and gadget built into their portal.
Lets face it, net savy users use very little to none of a portals services, because thats the only part of them that are ever good.
slipped in popularity? (Score:4)
In January, Yahoo slipped from second to third in the monthly ratings by Media Metrix, a research concern that tracks the popularity of Web sites in the United States, behind AOL Time Warner and Microsoft's MSN.
However, both these companies have the advantage of owning the top two browsers, which when loaded default to the respective companies' portals.
Yahoo has no such way to leverage its content into people's browsers. Thus, I would say that Yahoo is still winning, based on the fact that everyone that sees the front page actually wants to be there.
Also, when you look at different portals (how the hell do you define "portal", anyway?), Yahoo is the only one that still focuses it "main page" on the search engine.
Portal Feature Bloat (Score:5)
Yahoo and other portals have tried to follow suit, doing all things for all potential users, and in the process spending lavisly to acquire niche competitors.
But Yahoo doesn't have a lock on Web users the way Microsoft does with Office for desktop users. You can't just click a link to use Word Perfect rather than Word. But you certainly can leave Yahoo to use another site.
Sites that stay focused on what they do well tend to survive. It's the UNIX mantra - small, sharp tools that get the job done. I was a religious eGroups user until they got swallowed by Yahoo. Now the interface sucks and I'll probably start looking for a replacement.
Portals by definition are not lean and mean. You might even say that they are counter to the spirit of the Web. Things are *supposed* to be distributed, and users of the Web understand this better than all the industry pundits. They also have shown again and again that brand loyalty on the Web doesn't amount to squat.
Re:i think the problem... (Score:2)
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Banner advertising rates... (Score:3)
Allow me to quote...
"A banner is nothing more than a highway billboard, a reminder message," said Richard V. Hopple, a former ad agency executive and now chief executive of Unicast, an advertising technology firm. "We know what outdoor is worth ? $2 per thousand."
Has anyone noticed the context of web ads suck? When I read an interesting/daring/important article/story I try to click on the banner add to make the author some money. Somtimes, even though the article is blatently for geeky type people the add is for somthing totally uninteresting to geeks. To examine the opposing situation, has anyone noticed the coolness of the ThinkGeek Ads here?
So what is the going rate for banner adds? And how much is context taken into account. It seems to me Ebay will get more clicks because people there are in the mood to shop. People at Yahoo are their to check their stock or the game or the weather, not to buy a couch.
It's gotta be more than 2 dollars per thousand, but how much more?
Geeks in the Business World (Score:2)
Along came the Internet, and a bunch of people (geeks like us) who weren't familiar with the adverstising world started trying to sell ads. Since they didn't know the ropes they accepted crazy deals that were based on the number of responses to the ads. The economics of that scheme are almost equivalent to taking a piece of the net profit on a movie (never do that). This was a terrific deal for the advertisers. Really sucked for the ad space providers.
Now, wonder of wonders, the people who sold ads based on impressions or click-throughs are getting zero bucks while the advertisers get exactly the same value they always got from print or broadcast ads. Every time the banners come up they are putting their brand in front of a consumer although they almost never have to pay.
Next time we geeks decide to create a new business world we should probably hire some marketdroids up front to protect us from ourselves.
Re:No surprises. (Score:2)
Re:yahoo (Score:2)
It always seems that easy. And, of course, one of the greatest things about the internet is that at bottom it is ip, tcp and http...or about a quarters worth of study at community college.
But then, of course there is Murphy's Law...hardware breaks, constantly debugging scripts, adding new pages, crazy Discordian programmers smoking weed in the bathrooms, climate controlled server rooms, bandwidth, advertising departments. Stuff gets complicated like that.
Maybe if instead of being ran by a central source, the de facto web directory was just run by a diffuse organization connecting one page to another, then it would take little money and few employees to link the web together, but then "coonecting one page to another" is kind of what the web is about anyway, right?
Here's a question (Score:4)
Do these banner ads _really_ have smaller return on investment than many forms of "conventional" advertising, or is it simply that their ROI is easier to measure in the internet world?
The problem is the scope of the sites... (Score:2)
Re:slipped in popularity? (Score:2)
I wonder what audience reach numbers would look like if you limited the sample to users who typed, clicked, or chose a bookmark to get to a portal.
Re:No surprises. (Score:2)