Archive for December, 2005

Google Seals AOL Deal

paulballen — Wed, 21 Dec 2005 14:40:46 -0800

It's official: Google is investing $1 billion in AOL and getting a five year extension on their contract to provide paid search results to the AOL network. So Google will remain by far the most important starting point for search engine marketers, probably for some time to come.

Microsoft's AdCenter will provide better demographic targeting for advertisers in the near term (when it launches) but Microsoft will have to build its search traffic for this to matter very much.

Wikipedia's New Competition

paulballen — Tue, 20 Dec 2005 16:21:07 -0800

Wikipedia is providing "semi-protection" to articles that get vandalized often. New users won't be able to edit these pages.

Meanwhile, Wikipedia co-founder Larry and serial entrepreneur Joe Firmage (who has Utah roots) have raised $10 million to create an expert-driven open source encyclopedia called Digital Universe.

It will be interesting to see if anything can stop the momentum of Wikipedia. I wouldn't bet that Digital Universe will ever come close to catching up. That said, a commercially funded #2 player in the online encyclopedia space could very well be a financial success. And I think that it will be.

User generated video content

paulballen — Tue, 20 Dec 2005 16:07:42 -0800

Al Gore's Current has a very interesting business model. I've always been a fan of user-generated content business models (at Ancestry.com our most popular databases came from user submissions).

Current is turning user generated video into a broadcasting business. Co-founder Joel Hyatt predicts that in 5 years most of Current's content will be available on mobile devices such as cell phones and iPods.

This is a company to watch, as it pioneers advertising models and user generated video content.

Will Google Invest $1 Billion in AOL, cut out Microsoft?

paulballen — Fri, 16 Dec 2005 22:04:06 -0800

This could be big. I've been wondering if some balance of power might start shifting back to Microsoft; but if Google can pull off an investment deal with AOL and get access to their content and community, then Microsoft is going to continue to struggle with online market share.

Gmail for mobile phones

paulballen — Fri, 16 Dec 2005 14:52:34 -0800

Can't wait to see how well this works -- gmail on mobile phones. Since my Blackberry has email and phone, I don't have a separate mobile phone that mobile gmail will work on.

I like Yahoo Mail Search

paulballen — Fri, 16 Dec 2005 05:13:09 -0800

I now have a fast full text search in my email. Yahoo Mail beta has a fast full text search engine. Must have come from the Yahoo acquisition of Stata Labs last October. This is extremely useful. Gmail also has a fast full-text search engine; but it doesn't sync with my Blackberry so I only use it rarely. (I do keep all my Google Alerts in it.) So far, Yahoo Mail is the winner, although the CAPTCHA thing could cause me to switch to Gmail as soon as they work well with the Blackberry.

Yahoo Mail Beta

paulballen — Fri, 16 Dec 2005 05:02:22 -0800

The new Yahoo Mail beta is a tremendous improvement on Yahoo Mail, which frankly I have been tiring of.

The new version is so much faster, the interface is much more like Outlook. I like everything except the CAPTCHA system which still requires me as a paying Yahoo Mail customer to enter text from a scrambled graphic image almost every time I send an email. It drives me crazy.

But overall, I'm loving Yahoo Mail, and I'll probably stick with it if I can figure out how to eliminate the CAPTCHA stuff. Does anyone know how I can avoid that?

Pitching VCs to Get Valuable Feedback

paulballen — Thu, 15 Dec 2005 14:36:34 -0800

Even if you don't need to raise money, or if you know you probably aren't fundable, you should probably get in the habit of hanging out with and pitching VCs regularly. Why?

Because VCs have more meta-data about who is doing what than any one else in the business world. They are on the front line of all the emerging technologies, the best new ideas, and they know hundreds and hundreds of entrepreneurs and funded companies.

I blogged last month about the phenomenal meeting that David Bradford and I had with Tim Draper of Draper, Fisher, Jurvetson, where he gave us a HUGE idea for FundingUniverse.com. That has started the ball rolling and our team is mobilizing around his idea.

Yesterday one of our teams had a meeting with a very successful VC who shared some excellent wisdom with us. Here are some tidbits:

He asked, "Who are you going to sell the company to?" We didn't have a good answer. He said, "I never start a company without knowing who is going to buy it. And then I run the company with the intention of not selling to them, otherwise we stop focusing on our customer."

"Laser focus on your customer and serve their needs. If you don't know who is going to buy you, then you don't understand your customer."

"Who is your customer? How many have you talked to? What are the top 3 features they want?"

"Focus groups are a complete waste of time. They have made more companies go out of business ... if you get the wrong panel, you won't solve the right problems."

Build a panel of customers from the kind of people that always say they knew what was coming. Nail the panel. Have them tell you what is coming and then work back from there."

Must read book: "Getting It Right The First Time" by Internet Research Group

Our venture friend also told us about a great new technology that might fit into what we are doing.

So bottom line was we got feedback on our business, our team, potential partners, and some pointed questions that will force us to better define our customers, systematically talk with more of them, and think about our exit and who will want to buy us as we meet our customers needs.

So when is the last time you pitched a VC? What is stopping you from trying that right now? Make some phone calls. Use LinkedIn. Get introduced. Try your pitch and see what you can learn.

Playing With Widgets

paulballen — Thu, 15 Dec 2005 05:47:34 -0800

Google has released its Google Homepage API and Yahoo recently introduced its Yahoo Widgets Engine (see CNET article). More toys for developers to play with. I remember back in 1999 or 2000 when Homestead enabled its home page builders to use something like 150 "elements" to customize their web sites.

MCI Microsoft Deal

paulballen — Tue, 13 Dec 2005 11:53:46 -0800

Microsoft and MCI announced a multi-year global deal in VOIP.

I sure like the name Skype more than "MCI Web Calling for Windows Live (TM) Call". Of course they could always use the acronym: MWCFWLC. Yeah, that's much better.

Official Provo Labs Announcement

paulballen — Tue, 13 Dec 2005 11:36:56 -0800

Provo Labs is now funded.

Our small incubator team intends to launch between 12-20 internet startup companies in the next 2-3 years. We have an office at Canyon Park now (in Orem) but as per our name, we'll be moving to Provo early next year.

Our m/o is to generate great ideas, build working prototypes (or live web sites) quickly and by using the best internet marketing techniques, bring enough visitors to each web site that we can prove each concept.

If a business idea passes the initial market test, then we will provide enough seed capital to build a team and fund a go-to-market strategy. Our goal is to reach positive cash flow from Provo Labs initial investment.

But some startups will need more than just seed capital. If necessary, we'll use FundingUniverse.com to help us find angel capital, or in some cases we might seek venture capital.

We love Provo and believe this is the right place to do internet business incubation. The talent pool is excellent. The language pool may be the best in the U.S. (because of BYU and the Mormon missionary system which sends thousands of young men and young women to live in more than 160 countries for two years.)

Some of my Silicon Valley friends who are struggling to find developers (since Google is hiring all the best people) have congratulated me for launching in Provo. They believe it will be a real advantage.

In the coming months we'll be looking for part and full time developers, internet marketers, content experts, sales people and interns and lots and lots of contractors.

Our current investments include Infobase Media, which markets audio products, and FundingUniverse.com, which matches angel investors with entrepreneurs.

Our newly funded projects incude Worldhistory.com, where we intend to build the largest database of historical events, Blastyx, a Web 2.0-ish online promotion/marketing company, and a new mobile e-commerce technology company that we are doing with Alan Hall.

We are also exploring various other ideas including genealogy and family, online education, mapping, vertical search engines, social networking and blogging, politics, and international opportunities.

We also have a budget to acquire a number of web properties that have unrealized potential, where our team can significantly increase the traffic and revenue.

Our core competencies include content and search, online community building, and metrics-driven internet marketing.

If you want to experience the pace and intensity of Silicon Valley (yes, we are as passionate as Google about changing the world) while enjoying the Utah lifestyle, then please drop me an email or send a resume to Amy Rhoads at amyrhoadsATgmail.com.

We'll invite you to some Geek Dinners or some entrepreneur Brainstorm Lunches, where we can get to know you better and see if there's a place for your on our team.

Get data from massive web crawling system

paulballen — Tue, 13 Dec 2005 10:53:27 -0800

Amazon owns Alexa, and today Alexa is announcing a web service that allows developers to make special requests for content during Alexa's web crawls. The Wall Street Journal article gives the example of asking the crawler to help you identify new music files or images that have recently been posted to the web.

I'm interested in using the Alexa service to identify and track the number of links coming in to sites I am promoting (or competing with). The service is free for 10,000 requests a month and then there is a charge of $0.15 for each additional 1,000 requests, according to Paidcontent.org.

Last month I met the evangelist from Amazon's six other web services at a BYU event, including the amazing Mechanical Turk.

It's becoming more difficult to keep track of all the web services and APIs coming out from the major internet companies.

Who knows the best blog or web site that tracks all of these?

Yahoo buys del.icio.us

paulballen — Sun, 11 Dec 2005 00:38:07 -0800

First Flickr, now del.icio.us. In April Del.icio.us got "somewhere around $2 million" in funding for a minority stake. Don't know yet what Yahoo paid for it. Company has only 9 employees but has really had an impact in tagging and bookmarking.

Free Online Stock Photos

paulballen — Fri, 09 Dec 2005 13:48:47 -0800

From Seth Godin:

StockxChange just launched version 6, and it's better than ever. 175,000 free photos, most of them amazing. They also launched a for-fee site, but this is a great place to start.

Low Cost Mobile Internet-Enabled Computers

paulballen — Fri, 09 Dec 2005 12:22:36 -0800

AMD and DOL (the largest ISP in Turkey) are rolling out an internet-enabled 3 pound computing and communicating devices for $19.95 per month. Radio Shack sells a US version. AMD wants 50% of the world population to have computing devices by 2015. (See article)

November Connect Magazine Column

paulballen — Fri, 09 Dec 2005 11:48:36 -0800

Check out my latest article in Connect Magazine that gives my impressions of the Shop.org event in Las Vegas earlier this year. Let me know what you think of the article.

And please, tell me topics you would like me to cover next time? Remember, at Connect you are the "editor-in-chief" so let me know what you want to see.

In case I haven't mentioned it before, I got this Connect writing gig because of my blog. I've written before about the myriad benefits of blogging.

UVEF Award winners

paulballen — Fri, 09 Dec 2005 05:00:42 -0800

Here are the winners of awards from UVEF this year.

1. Mike Proper won the Ron Community Service Award. He was orphaned at age 10 and didn't finish high school, but he has created more than one multi-million business, and his current company DirectPointe is growing by 200% per year. Mike speaks often to high school and college students. He has helped create a public private partnership to help single moms escape the dead end of low paying jobs.

Mike Proper: I find meaning from our forefathers who gave us freedom and opportunity. I want to acknowledge them. He plans to be more involve at UVEF. I wants to help others believe in themselves. I want everyone to feel worth and to know that each one can know they can do whatever they set their mind to.

2. Greatest Contribution to Entrepreneurs: Kyle Love. He cofounded UVEF in 1989. He serves on boards for Omniture and ShopSite. He is a founding member of Utah Angels. He has helped at BYU with mentoring students. He recently helped turn around Cogito and raise $10 million for it.

Kyle: when he graduated from college he and his wife wanted to stay here, but there wasn't much high tech opportunity, so we moved to Oregon. In 1981 they wanted to move back. He worked for Wicat then started his own. Back then there was no venture capital. So we've tried to help make

3. Best Kept Secret. Certiport. In the last 7 years the company has emerged as a leader in training and certification. There are more than 9,000 Certiport centers in 130 countries. In Cleveland, Certiport is working to certify 30,000 underserved citiizens so they aren't shut out from the digital world.

David, CEO. I relocated from NYC Manhattan to come here because of the beauty of this place and the pool of talent. We work in 20 different languages because of the talent pool here. We have 130 employees in American Fork. 4 men and 3 women executives.

4. Most Innovative Product. Network Composer by Cymphonix. This product let's network administrators see what is happening on the internet in real time. It is a robust threat-management and performance optimizing firewall available today. It is not a subscription solution, but is the most affordable solution available.

Kevin Santiago, CEO. I'm glad I didn't have to describe our product. I've been carrying around a book called "Your Marketing Sucks." Two of our angel investors are here today, including John Richards and David Ruff. John helped us get to vSpring, our lead investor.

5. Entrepreneur of the Year: Morgan Lynch, LogoWorks. This company solves a simple problem, helping businesses get a great logo at a low price. More than 30,000 businesses have used this service, which uses multiple designers to give businesses a choice in logos.

Morgan Lynch: I have Lance Archibald here with me of Date Lance fame and he just won some jazz tickets. This year we've had a great year, getting to VC funds to make their first investments here in Utah. We have attracted a lot of talent. The Date Lance thing has turned into something bigger. People love working at our company. There were times as a bootstrap company where we had low compensation and no compensation plans. Now I go to work and I love it and I think, wow, how did this happen? Every time I come back to Utah Valley I think we are so lucky to be here, we have great access to talent and a lower cost structure.

Sent wirelessly via BlackBerry from T-Mobile.

UVEF luncheon today

paulballen — Thu, 08 Dec 2005 17:36:20 -0800

I should have blogged about this a few days ago. UVEF is holding it's annual December awards banquet at noon today at the Provo Marriott. Keith McCord will be the master of ceremonies. Pay $20 at the door and learn about the top entrepreneurial businesses in Utah this year (as judged by our UVEF board of trustees.) This is always a great networking opportunity for Utah entrepreneurs.

Concept to Contender Overnight

paulballen — Wed, 07 Dec 2005 22:57:00 -0800

Business 2.0 had a great article back in June about how entrepreneurs are creating instant companies by coming up with great ideas and outsourcing just about everything.

Here's an excerpt:

In sum, four guys with a great idea, some good contacts, and a loan to cover initial inventory figured they could go head-to-head with Nike (NKE) in just 60 days.

Two months later a factory in China was churning out the clogs, the slip-ons, and, yes, the Mary Janes -- 16 styles in all. The rest is footwear history. According to Van Dine, in 2004 Keen sold $30 million worth of shoes -- around 700,000 pairs -- with Mary Janes and other nonsandals accounting for 45 percent of the total. To put that in perspective, it took Teva three years to reach just $1 million in annual sales. Within months of Keen's launch, some of the most highly trafficked hipster websites and outdoor-gear blogs were singing the brand's praises, generating free buzz worth hundreds of thousands of dollars. "You could say we were birthed full size," Van Dine says.

Keen's overnight rise reflects many elements of traditional brand building: a product customers love, a talented management team, even old-fashioned tactics like telling retailers the shoes are sold out just to stoke demand. But the company's swift transformation from industry nobody to brand somebody also makes Keen something else: an example of a new breed of product-oriented startups that's going from concept to contender at warp speed.

In apparel, toys, sports equipment, electronics, motor vehicles -- you name it -- small but savvy new companies are wedging themselves into established industries, unburdened by the fixed costs of infrastructure past. They're doing it with the help of resources never before available so cheaply to startups, like outsourced manufacturing, Internet-powered publicity, and robust design tools. To get to market fast, they farm out everything they can, from logistics and billing to sales and support. "This," says Timothy Faley, managing director of the University of Michigan's Institute for Entrepreneurial Studies, "is how the manufacturing moguls of the future are getting started."

The keys to success in fast company building seem to be:

1. "some good contacts"
2. powerful design tools
3. outsourced manufacturing
4. internet-based publicity

The author quotes a business professor who says these fast moving companies seem to "farm out everything they can, from logistics and billing to sales and support."

I'm trying to figure out how Provo Labs, my newly christened internet business incubator, will be able to start and fund at least a dozen successful internet companies in the next three years.

I think this Business 2.0 article contains several keys and definitely reflects the kind of mind-set that our small internal team needs to have.

Some good contacts. I have about 3,000 contacts in my Blackberry and Yahoo Mail database. My assistant and I are going through all of them to categorize them, list their talents and skills, and to identify contractors and potential employees that could meet current and future needs.

Phil801, our COO, has relationships with scores of developers. By using Monster.com, elance, local recruiters and our own blogs and email lists, we should be able to identify skilled people who can meet any need, quickly and cost-effectively.

So our Provo Labs weekly meetings might look something like this:

Paul. Worldhistory.com needs a multi-user blog functionality and we need to recruit 100 history teachers to blog on different topics.
Amy. We've got 12 open source developers in our talent database that can do that.
Phil. Trent is available and he can do this in a few hours.
Amy. Done.
Phil. Why don't we ask Dave to do a fax campaign to 10,000 public and private schools and offer a bonus to history teachers who run the most popular blogs during the next three months.
Paul. Okay. Have him run the creative past Bruce before he goes live.
Amy. I'll take care of that.

Phil. Blastyx needs 100 gb of storage space for the new video streams we're going to be hosting once our contract filming teams visit client X and client Y.
Paul. Call Erich, ask him to add a new harddrive to our server. Dan just bought a bunch of hardware on eBay, so have Erich check with him first and bill us for this.
Phil. I just emailed him.

Amy. We need 4 more contract writers for ConstantPR because our press release demand is really picking up.
Phil. Danny can hire 4 more people for us within a week in the Phillipines office.
Paul. Do it.

Paul. We've got to get our traffic up on directory.net. I think we should bid on another 10,000 or so keywords.
Phil. I'll ask John to send us a list of the next best 10,000 keywords using his keyword analysis tool, and I'll send them over to Jim to upload them to Google and Yahoo Search.
Paul. We also need to test new landing pages on the sponsor sign up page.
Amy. I'll email 3 landing page designers and ask each one to submit a new design by tomorrow evening.
Phil. Jimmy can roll them live so in two days we'll have some data.

Outsourcing almost everything. If our small team can get to know the customer needs (based on customer feedback and management input) for all of our companies as well as the skills sets and availability of hundreds of outside web designers, back end developers, hardware engineers, web analysts, search engine marketers, copy writers, email marketers, recruiters, and business development people in dozens of large and small companies, then our planning meetings will be rapid-fire.

First we'll brainstorm for each of our companies. "Of all the things we could be doing to increase revenue, grow traffic, or cut costs (improve efficiencies), which should we try?"

Second, we'll ask ourselves, who can do this quickly and well?

Third, we'll make decisions and communicate them.

Fourth, we'll use Tadalist.com (or maybe we'll upgrade to BaseCamp after reading this Business 2.0 article again) to keep track of who is doing what and when.

Our core competencies need to be:

1) creativity and vision. We get that by attending all the best conferences, networking like crazy, brainstorming often and sharing freely with everyone we meet (not holding our cards to our vest), and reading all the best books and blogs.
2) talent scouts. Every one we meet is a potential contributor to one or more of our companies. We must always capture contact information and categorize the individual so they show up in our talent database. We'll flag contractors differently than potential full-time employees.
3) clear communication. We need to be crisp about communicating expectations, deadlines, and compensation.

Internet-based marketing. Three years ago we started 10x Marketing with a vision that every internet based company that we ever start in the future will likely be successful if we can have world class internet marketing available to us instantly.

So Provo Labs can outsource internet marketing to the team at 10x Marketing, or we can find independent contractors or other agencies that we can mobilize instantly around any new idea or web site that we launch.

One of our companies, Blastyx, will focus on internet-based publicity generation that will reach out into the blogosphere as well as capture the attention of traditional media. This is going to be hot.

So we'll utilize Blastyx to help launch each new company.

Conclusion. We live in an exciting era where great knowledge and empowering tools are available from sources worldwide.

But most workers today, even though they use email and the Web, are not really knowledge workers.

The mindset discussed in Business 2.0 is radically different from what people are accustomed to.

Most businesses have tons of unproductive employees.

The Entrepreneur's Manual published in 1977 by Richard White Jr. discusses this problem:

"Scientists and engineers have a way of measuring a machine's actual output against what that machine would do if there were no frictions, inefficiencies, or lost potentials. They call it effective output. If a machine's effective output is too low, the engineers redesign it to lower its frictions, improve its inefficiences, and realize more of its lost potentials.

There is no "machine" with greater capabilities or more flexibilities than the people who will work with and for you. What percentage of output would you guess that most companies realize from their people with respect to what they could realize if everyone gave his fullest to the company? Would you believe that the average large company realizes between 1% and 3% effective output efficiencies? According to the Institute of American Business Consultants, the average bureaucracy realizes between 0.25%-0.50% employee effective efficiency, the average industrial firm with greater than 10,000 employees between 0.5% and 1.5%; the average firm with greater than 500 employees, 1.0%-3.0%.

We'll discuss ways of rigging your company so that you'll incorporate the incentives and the systems to increase your team's output efficiences to between 10% and 15% later, but for right now it is important that you realize that your start-up can work extremely well with from 1/4th to 1/10th the number of warm bodies that your competitors must carry."

I think the Business 2.0 article and the hypothetical meeting I described above (where we rapidly match ideas with people and make assignments quickly) could describe companies that may achieve output efficiences approaching 50% or higher, if that is even humanly possible.

I believe we at Provo Labs have the proper mindset; let's hope we also have the network and the skill set to pull this off -- to become the Idealab! of Utah.

Mark Cuban post on preloaded iPods

paulballen — Wed, 07 Dec 2005 06:49:17 -0800

Mark Cuban has a great post on how nice it would be to be able to fill up mp3 players with 30-100 GB of great content and listen to our hearts content.

Not only is there a problem with the "statutory mechanical royalty rate" per song that makes this prohibitively expensive, but one of my companies tried to pre-load other content (audio books for which it has rights) onto iPods last year only to find that when customers configured the iPod for their computer system they lost everything that had been pre-installed.

So there are licensing limitations and technical limitations.

Does anyone know if any mp3 player manufacturer has overcome the technical problems with pre-loading content?

Intelligent Alerts

paulballen — Wed, 07 Dec 2005 06:31:42 -0800

I love Google Alerts and I get 50-100 per day on my blackberry.

But what I really want is an intelligent alerts system that cuts across all media types (including TV, radio, newspapers, magazines, blogs, business conferences, and podcasts) and prioritizes all of this media based on a profile that I build.

For example, I would set up a list of topics, people and companies that I am interested in. And I would create some rules about the kinds of content that I consider most authoritative: perhaps listing my favorite types of content, or publishers that I consider most credible.

Then, my intelligent agents would look in all media for matches. And all the matches would be added to my personal knowledge base (currently, I store all my alerts in gmail) so I could retrieve them at will.

But my daily diet of media content would be delivered to me based on pre-defined rules. So if there is an SEC filing or a free analyst report on a company I am tracking, that would be a top priority. Any MarketingSherpa case study on a topic or company of interest would be ranked high, because that content is invaluable. A Bambi Francisco column would come ahead of any other columnist. And blog posts by my favorite thinkers that match my topics would also come up first.

So if I'm going to maximize the use of my media time, I really need an agent to prioritize what I will be viewing, reading, or listening to in the hours that I devote to media.

But all this doesn't take into account one of the most important things I've learned in the last 10 years -- that the best use of my media time is in books. In Love is the Killer App, Tim Sanders argues that 80% of our learning time should be spent in books, since there is such a high concentration of lasting knowledge there.

So how does my intelligent agent handle books? Well, I suppose that with Amazon's search within a book and Google Print, that my agent will start looking for keyword matches in lots of books -- but I don't want them all delivered at once -- I somehow need these important matches to be turned into a steady daily stream.

But not all books are created equal. Some books become obsolete; others remain classics. Some new authors waste our time; but news appear on the scene with amazing new ideas.

Since I started using Tim Sander's approach to marking up books (where on the inside back pages I write the page number and the "big idea" that I find on any page), that one of the best uses of my time is to review all my notes on books that I've already read and loved.

So my intelligent agent needs to realize how forgetful I am, and that I often need to have the very best content I've ever encountered to be recirculated into my daily intake somehow.

I am reminded that Alan Kay said that the best way to predict the future is by inventing it; and I probably won't get the intelligent agent system that I really want unless I design it myself.

I hope I can make time to help design this kind of a personal knowledge management system.

In the end, for me, something like this would become even more valuable than Google's index of everything, because all content is not of equal worth, I can only take in so much, and I want to be able to take in the best content and be reminded continually of the great content I've already taken in but that I'm not utilizing effectively in practice.

Once I have internalized what I have learned, and I have incorporated it into training or curriculum for my employees or in systems that my employees use, then I don't need to be reminded of that stuff anymore.

John Battelle (author of "The Search") talks about "search to discover" and "search to recover." Of course we need both.

But perhaps in the future when there are literally trillions of web pages accessible to anyone on planet earth we will need something else even more. Maybe we should call it "search to cover." Or maybe "unsearch."

We'll need to filter out the 99.99% of content that is worthless to us and expose only the content that can help us find worthwhile relationships, useful knowledge, and ultimately satifisfaction, peace, and happiness in life.

One of the greatest scholars I've ever known (Hugh Nibley) once said that the role of a teacher is to save time by telling students what not to read.

Dallin H. Oaks, a former Utah Supreme Court Justice and current Mormon religious leader, said:

We have thousands of times more available information than Thomas Jefferson or Abraham Lincoln. Yet which of us would think ourselves a thousand times more educated or more serviceable to our fellowmen than they? The sublime quality of what these two men gave to us—including the Declaration of Independence and the Gettysburg Address—was not attributable to their great resources of information, for their libraries were comparatively small by our standards. Theirs was the wise and inspired use of a limited amount of information.

Available information wisely used is far more valuable than multiplied information allowed to lie fallow. I had to learn this obvious lesson as a law student.

Over 45 years ago, I was introduced to a law library with hundreds of thousands of law books. (Today such a library would include millions of additional pages available by electronic data retrieval.) When I began to prepare an assigned paper, I spent many days searching in hundreds of books for the needed material. I soon learned the obvious truth (already familiar to experienced researchers) that I could never complete my assigned task within the available time unless I focused my research in the beginning and stopped that research soon enough to have time to analyze my findings and compose my conclusions.

(Source: "Focus and Priorities", April 2001)

What an interesting challenge lies ahead. With the digitization of everything we run the risk of "ever learning but never able to come to a knowledge of the truth." (2 Timothy 3:7)

Google Businesses

paulballen — Wed, 07 Dec 2005 05:48:53 -0800

Here's a nice summary by CNET of 17 products offered by Google that each have significant revenue potential and will likely be distruptive to traditional companies in these markets.

BYU Internet Marketing Student Projects

paulballen — Wed, 07 Dec 2005 05:08:14 -0800

My 44 BusM 457 students gave class reports today on the 18 pay-per-click campaigns that they ran this semester for businesses. I was very impressed.

Almost all the student teams had prepared effective powerpoint slides which included how they approached their projects, how they brainstormed and chose keywords, and how they started running ads, using analytics, and then optimizing the campaigns.

Many of them showed actual click through rates and even conversion rates, since they had worked with the business webmasters to put tracking codes on the sites.

Here are a few take-aways from today's reports:

1. Google AdWords is still quite ineffective for local campaigns; even with local targeting, there's not enough query volume for some types of businesses to make this a good source of customers.
2. Google banned one company from using its online advertising tools. No one knew why. Google also temporarily took down other campaigns because they were "being reviewed." Google wields a lot of power over commerce and is usually not transparent or communicative. This causes lots of frustration. There seems to be a growing anti-Google sentiment among some of the student teams. More than one switched to Yahoo Search Marketing because they couldn't run their campaign on Google.
3. Online businesses using pay-per-click need to focus on conversion rate (and getting analytics set up properly) before spending a lot of money on clicks. One student team saw a huge increase in collecting email addresses when they started promising free shipping for early registrants.
4. Use the right marketing tactic for the job. One company found that a single email campaign to 2,700 people on a qualified list brought 30 people to an event, whereas keyword marketing brought only a few clicks.
5. For one company, Google Site Targeted Ads generated 23 times as much traffic as buying keywords. You have to test many things to know what will work best for you.
6. One student team started by bidding on tons of keywords--basically everything the company sold. They spent $105 before getting their first sale. Since it wasn't their money, they were pretty panicked. By focusing on the company's best-selling products, and by creating new Ad Groups around each cluster of keywords, and by testing new ads, the student team ended up with 85 sales in the first month and a cost-per-conversion of under $6. The company made an $800 profit in the first month! The team did so well that one of the students was offered a job.
7. The teams that learned how to use the Google {Keyword:default term} syntax ended up with generally higher click rates than those who did not. This makes it easy to have the keywords people are searching on actually show up in the title or text of your advertisement, which almost always results in higher click throughs. You can do it by hand, of course, by it takes forever when you are dealing with hundreds of keywords.
8. Programmers can always do more than non-programmers. One student described his system that looks at keywords that bring people to his site and then he automatically creates an SEO optimized page around that keyword, plus, using Google's API, he adds that keyword to his PPC campaign. So every day he is automatically generating more pages and more keywords to bid on, with almost no work. I have said for years that the most powerful internet marketing tactics that I know of require developers to build them.

I am very glad that the student teams all got hands-on experience with pay-per-click marketing. They have all been blogging this semester, too, and have been recruiting links and trying to build traffic to their blogs. (Some of my BYU student blogs are listed here.) But I wish I could have given them all hands on experience with email marketing, affiliate marketing, and conversion rate marketing. There's only so much you can cover in 16 weeks.

But I hope the students caught the internet marketing fever and the entrepreneurial bug. We had some awesome guest speakers this semester who inspired and taught us how to succeed online, including John Bresee (Backcountry.com), Dave Bateman (Property Solutions), Erika Wilde (Stopdirt.com), Robert Stevens (WriteExpress.com), Wendy Hudman (10x Media), John Jonas, Phil Windley, Dan Oaks (DVO.com), Jim Ericson (LDSAudio.com), and the guys who launched KatrinaHousing.org.

It's been a great semester.

I'm looking forward to the final.

Every student has been assigned to analyze and grade the internet marketing strategy for a different online business. They will analyze how well they are doing with keyword marketing, search engine optimization, email marketing, affiliate marketing, conversion rate, overall traffic, etc.

I'll blog next week about how they do.

Friends Reunited, Genes Reunited sold

paulballen — Tue, 06 Dec 2005 21:09:28 -0800

British broadcaster ITV is acquiring UK-based Friends Reunited for up to $305 million (including a possible payment in 2009 based on performance). While the company has several web sites, Charles Allen, ITV CEO, says that the genealogy site is "the real engine for growth" for the company.

Online Advertising Forecast for 2010

paulballen — Tue, 06 Dec 2005 21:00:09 -0800

Piper Jaffray estimates that the total online advertising market will reach $55 billion in 2010. That's a 27% CAGR from 2005 levels.

SG Cowen says companies will spend $17.3 billion in paid search and $12.4 billion in other forms of online advertising.

So this is a huge growth industry.

A professor of entrepreneurship once told me that while most start-up companies go out of business in the first five years, he claimed that 80% of businesses started in an industry whose growth rate exceeded 10% annually would be in business after five years.

If that is true, it is more important to start a company in a growth industry than almost anything else. If you are in a growth industry, the rising tide tends to lift all boats, including yours.

If search engine spending keeps rising at 27% per year, a lot of companies will make a lot of money in this industry. Agencies who manage PPC campaigns, SEO firms, analytics companies, web site publishers with high traffic -- all can do very well in the coming years.