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September 18, 2009 1:36 PM PDT

Google hoping history repeats itself with display ads

by Tom Krazit
  • 4 comments

With a new display ad exchange developed by its DoubleClick subsidiary, Google is hoping to give its one-trick pony another act.

Google has turned into one of the Internet's largest and most influential companies on the popularity of its search engine and the profitable text ads it sells alongside those search results. This business generates the vast majority of its revenue and profits and gives Google the resources to tackle a variety of other projects from Google Apps to Chrome OS to Google Books.

But like just about anything, that business can only grow so fast. Google will need another profitable, growing business to maintain its spot atop the Internet world, hence the motivation for its $3.1 billion purchase of DoubleClick a year ago and the launch of the DoubleClick Ad Exchange Friday.

The DoubleClick Ad Exchange is sort of like a stock exchange, where buyers and sellers meet to haggle over prices for display ads, such as banner ads or video ads. Companies that sign up to participate in the exchange can search for open spaces in which to place their ads and bid on that space just like Google's text-ad auction system for search keywords. It will also plug into Google's existing infrastructure for AdWords--ads sold on Google search results pages--as well as AdSense--ads hosted by Google but displayed on third-party Web sites, giving those customers another option for their marketing campaigns.

The DoubleClick Ad Exchange is based on the marriage of DoubleClick's ad exchange and Google's text-ad auction process.

(Credit: Screenshot by Tom Krazit/CNET)

Internet display advertising--banner ads, video ads, and the like--has a been a bit frustrating for advertisers and publishers to date. Advertisers spent $10.5 billion on search ads last year, up 20 percent from 2007, according to the Interactive Advertising Bureau. They spent $7.6 billion on display ads in 2008, up just 8 percent from the previous year.

Unlike simple text ads, display ads are more complex and time-consuming to develop, and haven't yet produced the same level of returns for advertisers that text ads have garnered. At the same time, the amount of advertising inventory on the Internet has exploded with the growth of news and entertainment on the Web, leaving tons of space for advertisers to flock their wares and the requisite supply and demand issues for publishers.

Yet even in the depths of a horrific advertising recession, few companies are willing to give up on Internet display ads altogether. They offer the chance to present a much more sophisticated brand image than a "Cool shoes found here!" text ad on Google or other search engines, and when not obnoxious can be creative and even entertaining.

Google is hoping that its auction-based format can entice more ad buyers into the display market by matching them more appropriately with publishers looking to offload their ad inventory. "We believe that a better system built on better technology can help grow the display advertising pie and benefit everyone," Google said in a blog post announcing the DoubleClick Ad Exchange.

As has been the case for years, Yahoo is squarely in Google's sights with this launch. Yahoo owns the display ad market at the moment following its purchase of Right Media in 2007, and with its decision to exit the search business plans to rely increasingly on display ads to fund its Web site in the coming years.

"While Right Media is the largest ad exchange and platform solution, we fully expect the display market to be fragmented and for there to be other exchanges. We welcome these exchanges, and look forward to working with them and integrating with them for our partners," Yahoo's Frank Weishaupt, vice president of North American marketplaces, said in a statement on Google's launch.

Google's edge could be the marriage of the AdWords and AdSense networks with the Display Ad Exchange. Under its deal with Microsoft Yahoo retains the right to sell search ads on search result pages powered by Bing, meaning it can also offer advertisers a combination of outlets for their messages. But advertisers looking for a search ad partner tend to think Google first, and that's not going to change unless Bing makes serious market share gains against Google over the coming year.

Some are skeptical that Google is going to make a large dent in this market right away. BernsteinResearch's Jeff Lindsey put out a research note spotted by Paid Content predicting that the exchange doubles DoubleClick's revenue to around $500 million next year, but that's still a pittance compared to Google's $21.8 billion in 2008 annual revenue.

But it's a chance for Google to see if the auction model developed for text ads will work in the more complicated display ad market, and could provide a foundation for future growth.

Originally posted at Relevant Results
July 14, 2009 4:00 AM PDT

Link exchanges: The poor man's SEO

by Tom Krazit
  • 20 comments

Large Internet companies spend millions on consultants and technology trying to get their sites to rank among the highest results on Google. Everyone else has to rely on the poor man's search-engine optimization: the link exchange.

If you've ever hung up your own shingle on the Web, you've probably gotten an e-mail to this effect at some point: "Dear So-and-so, I believe your site and mine could benefit from exchanging links." We probably get eight to 10 a week in the CNET News general mailbox, mostly from technology-related companies but occasionally from auto-parts suppliers and watch retailers who either have no idea what we do or few moral qualms about spam.

The idea is that if you can coax a link out of a large site like CNET, Google and other search engines will record that link as a vote of confidence in your site's worthiness and improve your ranking in searches for certain topics, thereby boosting traffic to your site. The technique is quite old, dating back even before Google and its PageRank system emerged as the Web's dominant search engine.

But does it still work? And at what point do two or three sites struggling to get off the ground veer off the road from mutual assistance to a full-blown spam operation designed to game the system?

Evan Duffield, for one, thinks it still works. He contacted us trying to get CNET to exchange links with WarpedAI.com, a site he has launched to promote stock-trading tools for day traders, and says he has been able to slowly build up the PageRank of another site he owns using techniques that don't run afoul of Google's Webmaster guidelines.

"It's kind of a vicious circle," he said. "To start a new business you need PageRank, but to get PageRank you need links to your service. You have to get the ball rolling."

PageRank is the currency of the Web. Google's novel approach to site indexing way back when was to evaluate the worthiness of a site based on how many other sites were linking to it, also taking into account the worthiness of the sites passing along the links. This meant, and still does mean, that a link from a site with a high PageRank counts for way more than a link from a site with low PageRank.

But how do you get a link from one of those sites? Google's official advice: "The best way to get other sites to create relevant links to yours is to create unique, relevant content that can quickly gain popularity in the Internet community." That, of course, sounds like something your mother would say.

In a Web as vast as this one, getting attention for a new site, even one with superb content, is a very difficult undertaking. Bloggers can discuss each other's work and help each other build up a following, but if you're selling a product or service it can be much more difficult to climb the ranks of search results for things like "day-trading software" when you're starting from scratch.

So Webmasters like Duffield turn to solicitations for links. Danny Sullivan, who writes about search-engine optimization for Search Engine Land, says "if you're a new site, absolutely you want to be doing link building. But you need to be doing that in a smart fashion."

Duffield says he's very careful to only solicit links from sites that are related to his product: his pitch for exchanging links that somehow wound up at our doorstep was addressed to computer-go@computer-go.org, a mailing list for hobbyists trying to tackle the difficult chore of building a computer AI system for the ancient game of go.

That was a mistake, he said; the result of prematurely hitting send on an e-mail template. Duffield compiles his targets by searching for sites that are related to finance and stock trading, and attempts to contact a general e-mail address to pass along his site's information and offer a link exchange.

"It's not about the actual links so much as it is optimizing search queries," Duffield said. "When I figure out a query I want from Google, I can see the top three positions have this much page rank and this many positions, and try to beat that out."

As long as people like Duffield are exchanging links without offering payment, or crossing obvious lines such as breaking captchas and posting spam links in guestbooks or comment forums, they're following the spirit of Google's Webmaster guidelines.

"Where it tends to get into tricky issues is where people are doing it primarily for payment," Sullivan said. "Search engines would see links as votes. Google does not like that people would simply be buying links to do better.

While paid links are clearly off-limits, Google appears to ban link exchanges in general, saying it does not allow "excessive link exchanging" but failing to define exactly what constitutes "excessive." Other practices that are verboten include links to "bad neighborhoods" on the Web and complicated networks of several Web sites with little content but pages and pages of links amongst themselves that Google can usually identify.

For the most part, however, the practice is rampant enough that only the most egregious violations get snagged. "If you start thinking too much about not getting caught, you're probably doing things you shouldn't be doing," Sullivan said.

In an era where SEO is a budding industry unto itself, link exchanges are perhaps the most basic approach. Far below the realm of those dithering over Google's search index are those like Duffield trying to make something out of literally nothing.

While he needs to build PageRank equity to get started, Duffield acknowledges that at a certain point that Google is right: a site will live or die on its content. Link exchanges only work to get one's name out there: the real boost needed to turn a Web site into a business comes when real people start discussing and linking to a service on blogs, message forums, and social-networking sites.

That's when your search ranking (and therefore traffic) really starts to grow, he said. "If you can make Google see that something is being talked about all over the Internet, what choice do they have?"

June 9, 2009 12:59 PM PDT

Google plots Exchange escape with Outlook plug-in

by Tom Krazit
  • 53 comments

Google has developed a way to help companies move onto Google Apps--and away from Microsoft's Exchange e-mail software--without forcing a migration to the Gmail user interface.

Google's Dave Girouard discusses how Google is making a play for more and more business customers for Google Apps.

(Credit: Tom Krazit/CNET News)

Microsoft's Outlook has been the dominant e-mail client within the business world for years, and Google's new Apps Sync for Outlook plug-in acknowledges that some business workers just aren't ready to give up that familiar interface, even if their CIOs are anxious to get everybody onto Google's version of the cloud. Businesses who have already signed up for Google Apps Premier Edition--as well as Education Edition customers--will be able to roll out this plug-in across their networks and allow Outlook messages, contacts, and calendar appointments to sync with Google Apps.

Google is trying to expand its presence inside the world's corporate IT departments with products like Google Apps, which the company says offers a cheaper and more reliable alternative to traditional IT software companies. Quoting data from Forrester, Google's David Girouard, president of Enterprise products, said companies who chose to use Google's hosted Gmail service save about $17 per user per month as compared to companies that build and host their own e-mail servers.

However, there apparently is a sizable enough number of workers that refuse to move off Outlook, meaning that IT directors who want to sign up with Google were forced to maintain a Microsoft Exchange server to placate those folks while moving everybody else to Gmail. An alternative where Outlook users are connected to Gmail through IMAP got the job done, but at the expense of a severe performance hit, said Chris Vander Mey, a senior product manager with Google.

Now, they can let those people continue to use Outlook but allow IT managers to move completely away from Exchange servers. "We've made it pretty easy to exchange your Exchange server for Google," Girouard said.

Google's eye is squarely on Microsoft's cozy position in the enterprise when it comes to products such as Google Apps. Around 1.75 million businesses are using Google Apps, Girouard said, although he declined to clarify how many of those businesses are Premier Edition customers.

CIOs invited by Google to a press event in San Francisco were naturally bullish on Google's version of cloud computing, and downplayed any concerns about security, reliability or the loss of a competitive advantage when it comes to giving up control of their IT.

"At most businesses, IT is not core. I'm not in the IT business to make money, I'm here to enable (my company) to win," said Bob Rudy, vice president and CIO for semiconductor designer Avago Technologies in San Jose.

The plug-in only works for Outlook users on Windows; Mac users on Entourage will have to wait.

February 12, 2009 11:24 PM PST

Next version of Outlook Web Access to actually support popular browsers

by Rafe Needleman
  • 6 comments

Microsoft announced on Thursday that the next version of the Exchange server, Exchange 14, will have a few useful new features including, finally, full support for browsers other than Internet Explorer.

Microsoft demo of Outlook Live

A Microsoft demo video shows full Web access to the Exchange e-mail server from Firefox running on Vista, and Safari on OS X. The Web access product is now called Outlook Live. University users of Microsoft's free hosted e-mail service (Exchange Labs) will get the beta of the service shortly. It appears that corporate users, who know of Web access to Exchange servers as Outlook Web Access, will get it when their companies upgrade to the Exchange 14 platform. Exchange 14 is expected either late in 2009 or in 2010.

Outlook Live will also give users a threaded conversation view, useful for tracking e-mails that get more than a few replies. And the online app will integrate IM (as Gmail does), although it will likely only connect to users of Microsoft instant messaging servers.

Since corporations are generally very conservative in their upgrade plans for electronic mail platforms, business users (like my CNET co-workers) should not expect access to Exchange 14 until, at the earliest, several months after the release of the product. Until then, users who want full-featured access from a Web browser to their Exchange e-mail servers are advised to keep a copy of Internet Explorer handy on their desktop.

November 17, 2008 10:33 AM PST

Microsoft aims to be a good host

by Ina Fried
  • 33 comments

Tim Tisdale, CEO of Atlanta-based ThoughtBridge, explains how his company is using Microsoft Online as part of an "HR in a box" service it sells to businesses.

(Credit: Ina Fried/CNET Networks)

SAN FRANCISCO--For perhaps the first time in its history, Microsoft made the case on Monday that businesses shouldn't run its software. Instead, Microsoft argued that corporations should let it run the software for them.

During the past several years, Microsoft has been testing out the idea that it can host and run business software cheaper and more effectively than individual enterprises can do on their own. The effort started in 2005 with a single customer--battery maker Energizer--which had Microsoft essentially handle all of its PC desktops.

Over time, Microsoft narrowed the service to an option in which it hosts Exchange and SharePoint, runs the software in its data center, and charges customers on a monthly basis. Microsoft officially launched the products, known as Microsoft Online, at a customer event at the St. Regis hotel here.

"We can help you save money," Microsoft Business Division President Stephen Elop told the crowd, saying Microsoft estimates that companies can save at least 10 percent by letting Microsoft run their messaging and collaboration software for them.

One of the early customers is video retailer BlockBuster, which has been using Exchange Online for about six months. Blockbuster CIO Keith Morrow said in an interview that Microsoft's online services came at a good time for the company, which was on a several-generations-old version of Lotus Notes.

Morrow said the video rental company needed to make a change of some kind, and the option to move to Exchange without having to bring that skill set in-house was a key selling point, as was the ability to offer better mobile options, including Outlook Web Access and iPhone support.

Another Notes switcher in the crowd was Eddie Bauer, which has been a Microsoft Online customer for about five weeks. Chief Information Officer Rich Mozack said the clothing retailer wanted to move off Notes but couldn't make the numbers work to run Exchange on its own.

"We just couldn't justify the up-front investment," Mozack said.

Microsoft's Ron Markezich said about two-thirds of early customers are moving from Notes to Exchange. But even as Microsoft continues to target those moving from Lotus Notes, the company faces the threat of its own Exchange customers moving to other hosted options, including Google Apps.

Just last week, Serena Software said it was switching to Google from Exchange in a move it said would save it $750,000 a year, according to several reports.

At the event, Elop made Microsoft's familiar case that, while the cloud is great, customers are better served by an option that allows software to run on customers' own machines as well as over the Internet.

Elop said Microsoft is adding thousands of servers to its data centers every month. Although Microsoft Online is initially aimed at Exchange and SharePoint, the goal is to offer a hosted option for all of Microsoft's server software.

"We expect all of it be available in this way in the near future," Elop said.

The software maker said last year that it would offer the hosted option for large businesses, later expanding the offer to businesses of all sizes. At last month's Professional Developer Conference in Los Angeles, Microsoft also confirmed that it would offer Web-based versions of its Office applications, including Word, Excel, and PowerPoint.

While many of those at Monday's event were the company's early customers and partners, not everyone at the event was ready to sign off. I spoke with a municipality that was highly interested in Microsoft's product, particularly as it plans to move from GroupWise to Exchange. Still, with a dearth of other governments to point to, this CIO told me that he still faced challenges in getting the city's upper management and government to sign off on the deal.

Originally posted at Beyond Binary
August 18, 2008 8:05 AM PDT

Report: Fees may sink Pandora soon

by Caroline McCarthy
  • 11 comments
Pandora logo

Tim Westergren, the founder of popular Web radio start-up Pandora, has said in an interview with The Washington Post that his company may be close to a shutdown.

"We're approaching a pull-the-plug kind of decision," Westergren said in the article, published Saturday. "This is like a last stand for webcasting."

The problem, he explained, is last year's royalty hike for Web radio, which makes it extremely expensive for an independent start-up to stay afloat in the business. The royalty increase will eat up 70 percent of Pandora's $25 million in revenue, Westergren said.

SoundExchange, an organization comprising representatives from record labels and performers, believes that Internet radio owes a bigger cut of profits than traditional radio does. Activist groups like the SaveNetRadio Coalition, along with start-ups like Pandora, have fought the fee hikes.

A few Web geeks weren't convinced that Pandora's situation is as dire as Westergren says it is. "I love Pandora like my old baseball glove, but they can only pull this Chicken Little move so many times," marketing consultant Brian Oberkirch posted to Twitter on Monday morning.

But Westergren assured in the Post interview that he's not exaggerating. "We're funded by venture capital," he explained. "They're not going to chase a company whose business model has been broken. So if it doesn't feel like it's headed towards a solution, we're done."

Originally posted at Digital Media
March 6, 2008 11:30 AM PST

The iPhone made easy for business customers

by Marguerite Reardon
  • 7 comments

Apple has finally granted the wish of business users who have craved the coolness of the iPhone but couldn't live without their push work e-mail.

News.com Poll

Day job for the iPhone
With Apple's updates, will you now use the iPhone for work?

Yes
No



View results

Until now, iPhone users who wanted to get e-mail on their iPhones had to jump through a series of technical hoops. And as a result, a lot of business users, who would have otherwise bought the iPhone right away, have stood on the sidelines with their BlackBerrys or Windows Mobile phones drooling at the iPhone.

But now these business users will be able to get their work e-mail on an iPhone just as easily as they can on a Windows mobile phone or a BlackBerry. On Thursday, Apple announced at an event at its headquarters in Cupertino, Calif., that Apple has licensed the Microsoft ActiveSync protocol, which will make it much easier to do push e-mail and contacts with Exchange servers.

Philip Schiller, Apple's senior vice president of Worldwide Product Marketing, demonstrated on stage how to activate and set up the Exchange function on an iPhone. The entire set up can be done over the air allowing e-mail, contacts, and calendar information to be automatically pushed to a device.

roundup
The iPhone opens up for business
Click here for complete coverage of Apple's iPhone SDK announcements, which give the hot-shot gadget its entree into Corporate America and even the gaming world.

The announcement is a huge deal for Apple, because it eliminates one of the barriers the company faced in addressing the business market. It also made the iPhone more appealing to a group known as prosumers, people who buy their own cell phones for personal use, but also access some business applications, such as corporate e-mail, on their phones.

Right now, Research in Motion dominates the business smartphone market with over two-thirds of its 12 million customers coming from businesses and government. Large businesses bought in early to RIM's push e-mail system, which requires large companies to have all their e-mail routed through RIM's own servers. For the most part, RIM's BlackBerry e-mail service has been a huge success. But there are signs that the company's dominance could be vulnerable. In the past six months RIM has experienced at least two major outages where e-mails were not forwarding to BlackBerry devices in a timely manner.

Blackberry's co-CEO Jim Balsillie said a day after the last outage that he wasn't too worried about the outage affecting its relationship with business customers. But as Apple makes it easier for corporate customers to get e-mail on the iPhone, he may reconsider.

Originally posted at News Blog
October 17, 2007 5:48 AM PDT

Apparently Microsoft prefers Zimbra, too

by Matt Asay
  • Post a comment

I saw this on Digg this morning. I'm not a Microsoft partner, so I can't access the file, but apparently it gives a competitive breakdown of Microsoft Exchange versus Zimbra, and candidly admits Zimbra's superiority in several areas. You can see the file in the image below.

I think it does Microsoft credit that it is admitting its fallibility. What I find much more interesting is that Microsoft is taking time to position itself against Zimbra at all. After all, Zimbra has almost no market share compared to Exchange. Yet Microsoft obviously views it as a threat.

... Read more
Originally posted at The Open Road
Matt Asay brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. Matt is vice president of business development at Alfresco, a company that develops open-source software for content management. He is a member of the CNET Blog Network and is not an employee of CNET. Disclosure.
October 8, 2007 5:32 PM PDT

New ad networks leverage Facebook's long tail

by Rafe Needleman
  • 4 comments

Let's say you've got a great new Facebook app or widget. Good for you! Too bad no one is going to see it.

Narendra Rocherolle (and a few other entrepreneurs) are trying to rescue your app. Rocherolle launched fbExchange a few months ago with the goal of making the "long tail" of apps work for developers. The idea is that you put a little ad banner on your page, which other apps are pitched on. In exchange, your app gets advertised on other Facebook apps.

fbExchange tucks ads into a little bar at the top of the site.

You can buy clicks if you have no traffic to feed into the network. You can also sell your advertising space outright if you don't want to participate in the click-for-click exchange.

All ads are single-line text blurbs that run at the top of Facebook app pages. Coming soon (possibly this week), fbExchange will be adding new advertising units.

I like this model. You can pay if you need traffic. You can charge if you have it. Or you can go freebie if you have some and need a bit more.

Other startups are working on Facebook advertising networks. Apps developer Hungry Machine is launching its ad network this week; the founders just showed me a demo of the analytics engine, which looks very strong. Lookery is also in the process of launching, and although the site is live, it wins my new Webware Mud Award--you can't really tell what the site does until you log in (and not much then, either). But trust me: It's an ad network. See also Social Media, which works across social networks; RockYou, which operates several successful Facebook apps; and Cubics.

Rocherolle is up to more with fBExchange than just ads, though. He's hoping to create a data exchange, where one site can grab social network information from another, to build mashups. The data Rocherolle is hoping to help companies expose even Facebook doesn't have. For example, if you subscribe to a recipe app on Facebook, Facebook's servers will know that you use the app and which of your friends use it, but Facebook won't know which recipes you like, since that data is store on the app's servers, not Facebook's. Rocherolle wants to help create an exchange for this data. Hungry Machine's execs also pitched me on a similar vision; they said they hope to use cross-app data to more effectively target their ads.

There is a chance that Facebook itself might launch an ad program that competes with these companies, but in the meantime, Facebook developers looking to make a few bucks--or get the traffic they need--might want to experiment with these new networks. Advertisers should get onboard soon, too. Getting experience with Facebook advertising is cheap right now. Rates are sure to go up as the platform matures.

January 11, 2007 12:12 PM PST

Cell phone freedom

by Elinor Mills
  • Post a comment
(Credit: CNET Networks)

A new Web site that helps people get out of their cell phone service contracts early has publicly launched. Cellswapper.com is billed as a social network in which members can exchange cell phone plans and phones.

For example, someone who wants to get out of a cell phone contract before it expires and not have to pay an early termination fee can transfer the remainder of the contract to someone looking for a free, short-term contract who doesn't want to pay an activation fee. It costs $14.95 to sell a plan on consignment, with no charge unless a sale is made, or $9.95 to pay up front. There is no fee to buy a contract.

The idea might appeal to people eyeballing the Apple iPhone, scheduled to go on sale in June with service from Cingular. The service launched in test mode last spring.

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