Webware

Jason Calacanis, CEO of Mahalo, is modifying his business once again. He's taking a page from Wikipedia and opening up his curated topic pages to user editing. The big difference from Wikipedia is that he's melding this idea with the Mahalo Answers business model in which users are paid for contributing content to the site.

"It's fine that Wikipedia believes that writers shouldn't be compensated," Calacanis told me. "We need to get out of the page creation business and move to the next level."

Here's how Mahalo 2.0 is going to do it:

Registered Mahalo users will be able to "claim" pages on the site. For example, if you're an expert in Betty Boop trivia, you'd claim the Betty Boop page. You'd be responsible for keep the content on the page relevant and fresh. In return, you will get half the advertising revenue (Mahalo uses Google AdSense) that the page generates.

This means that not only will Mahalo's users be creating the content, but since they're invested in the traffic to their pages, they'll likely be doing some of their own marketing for the content as well--on Twitter, Facebook, and so on.

There will also be a way to embed a Mahalo topic widget in another page. Calacanis will pay users a small amount for widget impressions, but the real goal for these widgets is to drive traffic back to the main Mahalo site.

Pages are given out only to registered users, and the number of a pages a user can claim depends on their "belt" level on the service (white belts can claim only two pages, for example). If a user who owns a page doesn't keep it maintained, then the system can take it back and puts in on the leaderboard where another user can grab it.

In Mahalo 2.0, that's the extent of ownership transactions. In 2.1, maybe, users will be able to sell the pages they're maintaining. Calacanis speculated that Mahalo might take a fee for enabling the transfer of control from one user to another.

Mahalo users can "claim" pages and edit them with improved page-building tools.

(Credit: Mahalo)

A necessary part of the new system is Mahalo's new and improved authoring interface. Replacing MediaWiki, which Mahalo has been using to date, the new tool builds the framework of a Web page from search results, lets the page owner pin items from search to the page, re-order items, and easily add explanatory text and media.

As he's done before (with Weblogs Inc. and with Mahalo so far), Calacanis is blending emerging media types with a clever application of raw capitalism. His theory, in keeping with his past ventures, is sound. The trick is the execution. For Mahalo, that hinges on people landing on the user-created pages because they are directed there from other search engines' results pages. Mahalo relies on search engine optimization, just as About.com did when it got started.

Opinions on Mahalo's success on this effort so far differ. Calacanis, of course, quotes increasing traffic and engagement results. Most people I talk to, though, don't see Mahalo results pop up in their daily search engine use and can't remember the last time they used the site.

My experience is more positive. I see Mahalo popping up from time to time. When I visit its pages, I find them generally very useful. Regardless, giving end users direct benefits for editing Mahalo pages will encourage them to take on some of the marketing expenses themselves, by promoting their pages. Assuming those promotions get picked up in search engines, it could help make these pages more visible. So this scheme should work better for Mahalo than its current model.

Mahalo may never be a household name like Google or Wikipedia. But it doesn't need to be. With a devoted cadre of users editing its most popular pages, and with successful search engine optimization being driven by Mahalo staffers and by users, the service should be able to sustain itself.

Hunch helps you make decisions. For quandaries ranging from "Where should I live?" to "Which blog should I read?" the system plays a question-and-answer game with you, to home in on an answer.

To improve your results, you can also teach the system about yourself by taking a quiz that asks questions like "Would you rather lead or be led?" and "Which 'Sesame Street' character appeals to you?" As you answer these questions, Hunch's algorithm is cataloging your answers and learning more about you.

I started using Hunch after taking the quiz. I asked it which blogs I should read, and whether or not I should switch to a Mac. I'm still not fully sold on Hunch yet, but its results meshed well with decisions I have already made.

For example, I tried the "Should I switch to a Mac" topic to find out if it would tell me to switch to a Mac, three years after I made the decision to do so. Hitch started out asking if my job required me to use Outlook. After answering "no", it asked me if I'm willing to spend more than $1,000 on a computer. I clicked "yes" and then it asked if I would want to engage in computer gaming. I said "no." I answered "no" to the question of whether or not I'm in the design field. It then asked if I make heavy use of Microsoft Excel. I don't, so I clicked "no."

Hunch's design is simple and elegant.

(Credit: Don Reisinger/CNET)

After telling the system that I'm comfortable "going under the hood" to change the computer's components, I answered that I would want a portable computer. Next, I was brought to the best question of them all: "Who do you prefer?" The answers were Bill Gates, Steve Jobs, Linus Torvalds, or no preference. After saying that I had no preference, Hunch's decision-making algorithm, which analyzes answers, returned my result: I had a 99 percent fit with a Mac. I should switch from a PC.

On more serious topics like "Which camera should I buy?" I found Hunch to be helpful. It asked thoughtful questions about what I'd like in a camera. It even asked what I'd do with it. After answering the questions, it found that the Nikon D80 was the camera for me. I researched its specs and I have to agree--it's ideal for what I'm looking for in a D-SLR.

I also found the "Which credit card should I get" topic useful. Based on my answers, it returned a card containing much of what I'm looking for: a low interest rate and the option to redeem points from a reputable bank.

Creation
All of Hunch's topics come from users. The site allows you to create topics, provide multiple choice answers, and based on those answers, determine results.

When you create a topic, the service finds images from across the Web to add art to it. That saves some time, but the amount of time you spend adding questions and determining results is ridiculous. And if you create a sophisticated topic with many questions, you'll need to run through answers one-by-one to link them to the topic's results. A topic can take up to an hour to create.

Creating a topic takes too long.

(Credit: Don Reisinger/CNET)

The design
Hunch looks good. The most popular and newest topics are there for you to check out on the main page. If you want to find other people on the site and see what they're up to, the "Community" tab has that information. But more importantly, Hunch's simple design makes the site easy to use. You won't have trouble finding desired topics.

Should I use Hunch?
Hunch is fun. At first, you'll probably enjoy browsing through the various topics and maybe even creating some of your own. But after a while, if you're anything like me, you'll gravitate to the more serious topics to help you make decisions. And although there aren't many topics on the site yet, I found that many were relevant to my life. More importantly, they helped me make smarter decisions on important issues, like finances and purchases.

Hunch provides a unique alternative to answers services from Yahoo or Mahalo. And although it's not perfect and it has some growing up to do, it has promise. It could become the "go-to" answer service on the Web with more user involvement.

Mahalo CEO Jason Calacanis sent an e-mail Thursday to his followers (also posted on his blog, and worth a read) disclosing that his company mistakenly hired a man convicted of computer crimes but who hasn't yet served his sentence. To retell Calacanis' story with a critical slant, his employee was caught (unusual for hackers) after launching a botnet attack that didn't work. And then he lied--or omitted the telling--about his conviction when he was interviewing at Mahalo.

Instead of firing him outright, Calacanis decided to keep him employed until his prison sentence begins on June 1.

Of course, we are all flawed, we make lots of mistakes in life, and we owe each other every kindness. It's possible that Mahalo's errant hire made one bonehead hacking move and saw the error of his ways, and he'll never do it again--although news reports of his crimes paint a much uglier picture. But it's what Calacanis believes. He says he knows the man, and I admire him for standing up for him, and keeping him employed when the easy thing, for a dozen reasons, would be to fire him.

But that doesn't mean I trust the company Mahalo more now. In fact, knowing that there's a lying, somewhat inept hacker working on Mahalo makes me wonder what personal data at Mahalo could be exposed. Calacanis takes pains in his letter to say that the employee's work is "well-supervised" and limited to simply Mahalo question-and-answer data. However, Mahalo does transact financial business, both with users (they can buy Mahalo Dollars), and of course with advertisers. How walled-off is that transaction data? How good are the employee's watchers? Who's the hacker in this equation, anyhow?

I do not believe in a zero tolerance policy for minor crimes, but my argument with this action is about economics and trust, not morals or ethics or laws. Mahalo, which recently had to lay off staffers to make sure it could weather the recession, is now spending extra supervisory energy watching this hopefully rehabilitated presumably former hacker work on its systems. Although in this particular case one may say that Calacanis is doing one man a kindness and spreading magnanimity and good karma around, one also has to ask: can Mahalo customers trust a business that keeps hackers employed? Can any online business, for that matter, afford to keep a convicted hacker on the payroll?

Stickam, a company that allows users to stream their lives online, announced Monday that it has launched an application programming interface that will let users incorporate the company's service into any Web site or app. According to the company, users can use its video-streaming function on their sites without worry of bandwidth, server infrastructure, or Flash development, since it will all be hosted through Stickam. The API is available now as a public beta for the first 100 registered developers at no cost. Once the beta period ends, Stickam will charge developers an undisclosed fee based on a pay-as-you-go pricing model.

Human-powered search engine Mahalo announced on Monday the launch of Mahalo Answers, which allows users to submit questions to the community, which will then be answered by other Mahalo users. Mahalo Answers is quite similar to Yahoo Answers, but it does feature one twist: users can offer "tips" (in Mahalo dollars) to those who post the best answers. For its part, Mahalo will take 25 percent of the cash exchanged between users.

Hot or Not is an extremely popular site that allows users to rate a person's appearance based on a posted picture. Responding to its popularity, a new site called Twit or Fit has launched, which will provide Twitter profile pictures that will be graded based on the person's physical appearance. Visitors can decide to look at only men or women or view the top 10 highest-rated people. Twit or Fit also provides the option of announcing grades through the user's Twitter profile.

On Monday, Intel announced the results of its Internet study, which found that most U.S. adults would rather have Internet access than watch TV or engage in sexual activity. About 65 percent of respondents said they cannot live without Internet access, and 71 percent claim it is important or very important to have Internet-enabled devices. The vast majority of the respondents believe the Web has become an integral component in the U.S. economy and a central part of their lives.

Jason Calacanis is adding another human-powered angle to the Mahalo curated search page service he launched in May 2007. Mahalo Answers, launching Monday, lets users ask specific questions of the Mahalo audience, and, of course, answer other users' questions as well. The twist on this standard model (see also: Yahoo answers) is financial.

You can ask questions for free if you like, but you can also put a bounty on a question with the Mahalo dollars you buy from the service. Of the users who answer a question you've set up a "tip" for, the one whose answer you designate as best gets 75 percent of the money you've put up. The rest goes to Mahalo.

Questions with bounties on them get promoted to the top of the list.

Mahalo is seeding some accounts with $10 of Mahalo currency, but you can't cash out until you answer some questions and earn your way to more than $30, so it's not exactly free money.

Also, if you ask a question and don't like any of the answers, you can rescind your tip, and no one gets paid. However, rescinding tips affects your profile and reduces the likelihood that people will answer your questions in the future. Mahalo Answers is employee-curated. Calacanis told me his team will be watching the questions submitted and will remove pointless ones.

Users can also send each other questions directly, with tips attached to them or not.

Mahalo answers is integrated into the rest of the service. If you are on a Mahalo page and have a question related to it, the question will show up on the page as well as on the Mahalao Answers page and, presumably, in Google searches.

What's different
While the idea of a Q&A system is not original, Mahalo has factors going for it that, in combination, make it a very interesting experiment. The money angle will do an interesting job of encouraging feedback, although I'm not sure a lot of people will fund the system with their own cash to kick it off. But the integration into the rest of Mahalo really works. It gives the answers system context, and having Answers on a standard Mahalo results pages helps complete the information on them.

Economically, this will be seen as a brilliant move--if it works. That's because, as Calacanis says, "Everyone is working on spec." When you ask a question, you put money into the system, and Mahalo is the bank. When you answer a question, you put knowledge into the system (which has value), and you might not get paid. Only one answer gets the bounty, and then Mahalo keeps 25 percent of it.

In addition to the cashflow and the float from Answers users, content will also appear on advertising-monetized search pages, generating more income for Mahalo. Calacanis says he doesn't yet know the value of a question or an answer when that's taken into consideration, but it explains why he's experimenting with giving credits away to users to get them to try the system--Mahalo makes some money even if no users buy in.

As I've said before, it's just as important for companies to experiment with business models as it is to try new technology and features, and that's what Mahalo is doing here. This Q&A product may not work, financially, as it is crafted today. Or it may. Regardless, it is good for companies experimenting with revenue-generating ideas. And this one is pretty clever.

Mahalo Answers are integrated into the Mahalo results pages.

Jason Calacanis, CEO of Mahalo, a human-powered search engine, announced today that he was forced to layoff 10 percent of his staff (about five or six people) amid a "challenging economic environment" that will require the company to cut costs.

"Although we've got a significant amount of cash on hand, and the business is ahead of schedule in terms of traffic, we're fairly certain that the advertising climate for the next two years will be severely depressed," Calacanis wrote in a blog post. "To ignore this obvious fact would be irresponsible.

"We've laid off just under 10 percent of our full-time staff, cut our overhead by doing smart things like renting desks, and reorganized our editorial department to focus on freelance positions over in-house editors. The net result of the effort is we are giving Mahalo another year of "dry power" (or runway) to complete our mission," he added.

Calacanis told CNET in an e-mail that the layoffs are "precautionary" and his decision to rearrange the editorial department by relying more on freelancers was inspired by his decision to follow "the Weblogs, Inc. model" of paying freelancers based on output while he was the CEO of that company.

"[The layoffs] give us four years of runway (which might be way too conservative), but I'd rather be a little conservative now and expand later when [the] ad market comes back," he said in an e-mail.

Mahalo, which tries to provide better search results on major topics thanks to editorial input, relies heavily on advertising as a source of revenue. But as Calacanis pointed out, the layoffs allow Mahalo to operate through 2012 even if the company couldn't incur any advertising revenue during that time period.

Friday at the Future of Web Apps conference in London, Mahalo CEO Jason Calacanis is set to announce an interesting update to the curated Web directory. The front page will get a ticker, or in modern terms, "live blog," of news items, updated in real time by a dedicated team.

Calacanis told me that the Mahalo home page has been getting some traction as a repeat destination site for visitors, and he wanted to get those, and other, users to stick on the site for longer. He also believes that news is a major driver of Internet traffic. So he's adding the ticker, and aims to have 20 updates an hour running through it. There will be eight people staffing the feature, with four to eight online at any one time, around the clock, every day of the year. "We're going to live-blog every single thing in the world," Calacanis says.

The ticker will have a dedicated page of its own, as well, with more live features: during certain hours of the day, a Web cam will be pointed at what can only be described as an anchorperson, and there will be a chat room where Mahalo users can talk about the news.

Each ticker item will be flagged by content area, and eventually the pages for those areas (like politics, sports, and weather) may also get tickers, as may high-traffic pages such as those for political candidates during an election.

Calacanis says he's not yet worried about monetizing this feature. He believes it will make the Mahalo site more sticky, which will drive clicks to pages that carry advertising. (I'll have more on online advertising in a future post.) With a claimed four years of operating capital in the bank, Calacanis says he can afford to experiment and aggressively launch new features. He also said he's looking forward to, possibly, picking up distressed online properties--either companies that are having trouble raising operating capital now, or projects that he expects the big online companies will soon be interested in offloading as not core to their business.

Regardless, I think the new live blog feature is smart for Mahalo, and a precursor to a new round of one-upsmanship in live news coverage on the news portals, as their teams try to figure out how to get users to stick to their sites for longer times per visit.

The new Mahalo home page will have a live ticker of news from around the Web, staffed 24/7 by a team of eight.

The ticker will have a page of its own, with a live news desk and chat room.

My Mahalo shows user reviews from people in your network alongside Web results.

(Credit: Mahalo)

Mahalo is adding user reviews to its human-powered search site in a new feature dubbed "My Mahalo."

So, when you search for books, movies, music, places, and products, a box appears on the right with reviews and comments from people in your Mahalo social network, as well as an average rating for whatever is being reviewed. Underneath the results is a section for user-recommended links related to the search and user reviews from other Mahalo users, as well as a link to discuss the page with others.

If you are using the Mahalo toolbar, the user reviews will be combined beside and below the results on Google, Yahoo, or Microsoft Live Search.

The aim is to create a page where you can see not only Web search results, but also find out what your friends have to say about what you are looking for, and whether they have bought that item or want to buy it.

"We're attempting to say we have real good search results plus a social graph," says Mahalo Chief Executive Jason Calacanis, who announced My Mahalo at the Search Engine Strategies conference in New York Wednesday. "It's the first time anyone has done it."

Another new feature lets users easily import information from other social networks and sites (such as a bookshelf from GoodReads or a Netflix queue) so that data too appears on Mahalo.

The new items automatically appear in your profile as reviews. The profiles are available for anyone on the Web to see.

"We're reading peoples' reviews from RSS feeds and other systems," not using OpenSocial yet, Calacanis says. "All data will be easily imported and exported out from Mahalo."

Since Mahalo launched last May, the site has create more than 40,000 pages of content and attracted about 400 paid contributors who create the pages, Calacanis says. The site, which runs Google ads, gets about 3.7 million monthly visitors, about 2.5 million in the U.S., he says.

Adding the user reviews component does differentiate Mahalo, but we wonder how it can effectively compete against Google and Yahoo, which are likely to add social-networking components at some point. And can it best established review sites like Yelp, Amazon.com, and even Netflix?

"We're figuring out the metrics of the business," Calacanis concedes. "In a year there could be 1,000 to 2,000 people working from home to build, basically, a wire service or news service, but for search."

Stay tuned.

This screenshot shows the music in Calacanis' profile page, as well as what ratings and reviews the items have received on Mahalo.

(Credit: Mahalo)

Mahalo launched a new Firefox extension last week at Gnomedex. It's called "Follow," and once installed, it does just that. It's a mix of a toolbar and sidebar that pulls up related search results from whatever page you're on. It's got a built-in Mahalo search box in an attempt to ween you off your Google and Yahoo search tendencies. It's also got a StumbleUpon-like function to recommend whatever page you're looking at to others with yes, no, and maybe buttons, along with a button to take you to a random Mahalo page. The tool is being pitched as a way to show how Mahalo provides more interesting results, but I can't quite get my head around it.

For one thing, the sidebar takes up a lot of space. It's also not necessarily a new idea. Blinkx's Pico, Alexas' Toolbar, and Lycos' SideSearch have all been here before, and with similar execution--except in the case of SideSearch, which was spyware. The StumbleUpon likeness of the toolbar confuses me even more. There's no clear listing of the top recommended sites, and the subsequent customized Mahalo landing pages offer little at this point besides links to outside pages. There's also no user incentive to keep providing your tastes, as the random page button doesn't seem to learn from your likes and dislikes. It feels very much like a first step, but with an unclear direction.

I'm also willing to wager that most people who are using Google and/or Yahoo to do basic searches are seeking out one specific page--and it's likely in the first few results. Once they've found what they're looking for, they're done. The whole idea of Mahalo Follow seems to want you to get used to the idea of searching the pages you're on continuously, in what seems like the hope of getting you to dig deeper--using Mahalo of course.

That said, exploratory Web surfing is fun, and the extension itself is snappy. It doesn't slow down your main browser frame's load time and doesn't pop up with any warnings or other nonsense when the sidebar has been dismissed. For those interested, Mahalo is giving away various prizes to people who can get their friends to install and use the toolbar through the end of next month.

See also Search Engine Land and Download Squad's take.

Previous Mahalo coverage:
Jason Calacanis' Mahalo: Screw the long tail

Once you've got Mahalo Follow installed, it will pull up a sidebar of Mahalo search results every time you do a Web search. There's also a StumbleUpon-like toolbar on top of every page to recommend pages to others.

(Credit: CNET Networks)