Google’s Best Effort to Thwart Piracy

piracy

Advertising giant Google has said it buries websites that help people illegally download copyrighted stuff.

Google claims it sinks pro-piracy sites way down its search results– beyond page two, the grim wastelands of the web. It has hoped this may dissuade people from seeking out pirated movies, games, TV and so on, until they discover torrenting or Netflix.

Google already tosses out links to pages from its results if it receives a takedown request from a copyright owner. Now it has tweaked its algorithms to lower a site’s placement in the rankings if its pages are routinely DMCA’d — perhaps if such sites take the hint, they’ll stop attracting bothersome takedown requests, the California company thinks.

Google now receives more copyright takedown requests in a single week than it did in the years 1998 to 2010 combined. The British Recorded Music Industry was the largest complainant last year, submitting 43.3 million takedown requests. Copyright group Degban was second, followed by the RIAA and MarkMonitor’s Antipiracy service.

While it works with copyright owners to keep pirated content off its services, the best way to stem the flow of piracy is to provide users with better streaming media and on-demand services.

Tough Times at Google High?

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It’s not that often that a cloud crosses the sunlit commercial uplands where the Googlers play….but last week was a little stormy.  The big story last week was the cataclysmic pounding which Netflix took when they missed their numbers and HBO announced a non-cable option.  The other sad story was Google. After reporting slower than anticipated revenue growth the markets took them behind the woodshed where their stock ended up at a mere $511.17.  I have covered the reasons for their predicament at length in this blog over the past few months and years….but let’s do the Cliff Notes version.

1   Desktop search has been rapidly overtaken by search on mobile devices. Mobile devices have much less space for ads and lots of the big advertisers still haven’t quite come to terms with mobile…even tho we the users are all about it. That means that as mobile click volume has risen the average price over all continue to drop. These are seismic metrics which anyone…even Wall Street analysts can readily grasp.

2   On mobile devices we tend to spend most of our time on apps like Facebook Instagram, Yelp and Twitter.  Google has spent billions acquiring “moonshot” projects focused on the long term big win.  It hasn’t been as successful acquiring the kinds of mobile aps that we are spending our mobile time on. In many cases we’d rather buy our stuff from Amazon or even ebay direct rather than do the Google dance.

3   A lot of people have developed a healthy scepticism about how Google (and others) handle our personal information.   They aren’t the only offenders for sure, but I have to believe there is at least some backlash against them.

Don’t get me wrong Google is still a powerhouse…but this may be the first time ever when the stars aren’t all fully aligned in their favor.

Mind The Gap

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There are certain mysteries in life which are ineffable…like where do all those solo socks go? why do I always end up picking up the tab? in the weird world of online there are several gaps which remain mysterious. Here’s a couple:

Tablets are divided between iPads (25%) and Androids (74%) with the Surface coming in a distant last at about 1%. The androids out number Apple because hundreds of companies make tablets with the Android OS on board whereas only Apple makes the iPad.  What’s weird and (I have never seen a satisfactory explanation for this) is that the bandwidth usage of all kinds is dominated by iPad at about 75% with Android taking the rest.  Given that all devices hook up to Wifi how is it possible that 25% of the users are consuming 75% of Tablet bandwidth.  There are multiple theories out there…maybe iPads are favored by data intensive corporate applications of the devices, others suggest that the dominance of iTunes in movie streaming is a factor…but then Netflix runs on both….any way you look at it, it’s a bit weird.

The other gap which is causing waves in our industry is the search revenue per click conundrum. Most people are reasonably familiar with the concept that when we click on ads in search results somebody (mostly Google) gets paid. As end users have migrated to mobile devices at a rate far greater than anyone could have ever imagined the advertisers haven’t.  Advertising agencies are notoriously conservative and (some might claim) in some ways dumb.  Search delivered on desktops has been around for over a decade and they are comfortable with that medium. A few years back social media exploded on the market and agencies were caught completely off guard. A few years later they are just about starting to catch up with the opportunity.  Mobile devices and delivering ads against those devices has left the industry scratching their heads…even now I am shocked and infuriated by major brands who still don’t have a mobile friendly site…let alone mobile friendly ad campaigns.  The result is that although Google’s revenue continues to head north at a good clip they are achieving that growth with many more cheaper clicks. That steady decline has been happening over the last couple of years with no end in sight.  In public statements Google has pinned their hopes on local advertisers paying a premium for mobile clicks to drive their local businesses. We are certainly seeing some pretty dramatic spikes in click prices for “hyperlocal” searches like “plumber West Oshkosh.”  The problem is that even large numbers of local businesses smart enough to bid online (but often not smart enough to get good ROI for their efforts) don’t compare to the massive spend the big brands can move between platforms. This will no doubt level out over time….but it’s not going to happen overnight.

Excuse Me As My Blood Boils

 

Yesterday I was babbling on about Google’s recent acquisition of a drone company…which is a bit of a diversion from their traditional online advertising world which is where their actual revenue still comes from. Their recent forays into everything from modular cell phones to self driving cars (which are causing some concerns among financial pundits about their fiscal profligacy) prove that they have a strong appetite for both the long game and tech baubles. Meanwhile back on the farm where the sausage and the money actually gets made they continue to conduct trench warfare against their real enemy…their advertisers.
This rant is more than a little inside baseball…so you have my permission to move on to your next agenda item…but just because I can I’m going to rant. What makes me perhaps most mad is the sheer disingenuousness of this most recent development. Here’s what’s up:
For the longest time if your web page or search ad was clicked on Google would tell you two very interesting bits of data; the search term which led to the click and for ads, the exact keyword which drove the click you paid for. That was helpful for website writers (ie SEO) as it allowed insights into who is searching for what. It was doubly useful for advertisers because we could better target search terms which led to clicks which led to conversion. It’s been an open secret for a long while that Google is not a huge fan of SEO and does as little as it can to give SEO folks anything to work with so taking that that away from them made a grim kind of sense. However given that we the advertisers who actually pay the cash which lets them buy cool stuff like robot companies and drone manufacturers used that information to help us plan campaigns and spend money on Google you might think that sharing information which lets us spend more efficiently (and thus probably more over the long term) might be seen as a good thing. Not so fast there hos!
Nearly two years ago Big G started encrypting the search terms from anyone logged into to any Google product under the guise of protecting searchers privacy. At that point they were still passing the search term and key word…coz…hey money is money.
The other day Google announced that they are now encrypting the search term for paid clicks also.  They will allow you to get an overall list of search terms which overall drove the clicks you paid for but where the end user is logged onto any Google service or using a Google Chrome browser we have now lost the ability to attribute the search term to the click which drove the conversion. The fig leaf they hide this act of aggression against their life blood of advertisers is that it helps ensure end user privacy.  The same end users who are essentially anonymous anyway.
What this really does is make the job of the advertiser who is attempting to spend marketing dollars on search terms and keywords which do convert that much harder.  Fortunately we still have data from the non logged in minority and Bing isn’t playing these sorts of games….but it’s still super annoying. I get that Google is under pressure to keep the revenue solid even as the average per click price slips and the desktop, but doing it by simply making life even harder than it has to be for the people who are actually paying the bills seems a little short sighted.

Welcome to the Casino…Have a Nice Day

I’m not good with Casinos….I’ve been to Vegas any number of times and on the last half dozen visits I don’t think I’ve gambled more than five bucks.  It’s partly that I don’t trust myself to get into something that addictive…part that I worked hard for that money and part that I’m just not good at it. There is a giant casino out there where the punters are playing marketing dollars for sales and it’s called Google. Historically Google has largely been the resort for large rich companies with teams of marketing professionals like us pitting their wits against the house.
Whilst Google has been doing very well of late with ad revenue up nicely in Q4 last year, the average click value declined 11% in the same period. What’s diluting the click price is the massive growth in mobile device clicks which (as yet) aren’t as valuable as desktop clicks. The problem Google has is that mobile clicks have already surpassed desktop and show no sign of slowing down.
So whats a giant Casino to do when the punters are growing in volume but avoiding the high stakes tables. The Casino either gets the same punters to spend more time at the high stakes table…or attract a bunch of new punters…hopefully without as much expertise as the existing crowd. I live in SoCal and we have an amazingly large number of Indian Casinos in our region (I know a guy who services slot machines and he has over 100 locations he serves within driving distance). What the Casinos do is bus punters from location to location all day long.
Yesterday Google’s Chief Business Officer made some interesting statements to the financial world at a Morgan Stanley Conference. Disambiguating these kind of statements is tricky…but several points seem to be emerging through the linguistic fog of Google speak.  
Google sees small local businesses looking to reach local customers looking for local customers on their mobile devices as the next influx of fresh meat to their Casino
It thinks this influx will drive the value of mobile clicks to “become a multiple” of the comparable desktop clicks…..which would nicely solve the problem of mobile clicks driving down average click value.
That’s a really interesting set of statements. We already see the impact in local businesses (most of whom aren’t online marketing experts) joining the casino. Online advertising isn’t a sport for the inexperienced…it’s incredibly easy to put money down and blow through it in perhaps seconds without the advertiser seeing a single cent of return on their investment. We know from our own efforts that tracking the ROI for local businesses can sobering.
The risk is that Google will continue to market aggressively to local businesses who will show up at their Casino slap the college fund down and leave never to return because they simply didn’t see the value. Google has recently been telling the cohorts of marketing professionals who have been spending with them for many years to look beyond the obvious conversion event and look for value driven by search all over the web. It’s possibly a good argument to make to Nike or Apple…it’s much tougher to convince a roofer or dentist of almost invisible value.  

Our business is based on driving proven ROI in the form of tracked calls.  The mess created by local businesses headed into the Google casino is likely to make businesses even more suspicious of everything online…which might be great for us long term it puts many of the tables out of reach for the professional gamblers amongst us.

Local Online Confusion

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The chances are that you are reading this on your smart phone or tablet or perhaps you are taking a break from your phone to read this on your computer or even on that charming ‘dead tree product’ called a magazine.  So much of how we live and shop has moved online.  Large companies with massive marketing budgets now have teams of online experts figuring out how to reach their audience through the complex web of new media often in tandem with traditional media.

Now answer this question: When was the last time you interacted with your yellow pages?  I don’t mean when you picked it up and walked it straight to your recycling bin, I mean when you last used it to find a local business. Thought so…me neither.  There was a time quite recently when your Sunday paper had to be lowered buy winch onto your front porch…now, if you still get it all, it’s clearly been on a severe diet.  We have been living through a massive realignment of media…print media has been vaporizing before our eyes.

What hasn’t changed anywhere near as much is the rest of our every-day issues.  We still get tooth aches, leaks in our pipes, pest infestations and we get married.  We still use dentists, plumbers, rat catchers and party rental stores.  The massive real world operation which is the twenty million local businesses in the US still do business every day.  What went away is the way those businesses use to get new clients.

It used to be that owning a home and sending your kids to college was the American Dream.  Those have become much closer to the new normal for many Americans, now owning your own business has become for many a new part of that dream.  The BIA Kelsey organization, experts in all things local, tells us that each year roughly half of all business done by local businesses is new business.  Local businesses get that and are desperately trying to come to terms with a radically altered local advertising environment.  It’s no longer good enough just to have a basic website, local businesses really need a social media plan, they may have to manage their online reputation, they may even tweet!  The complex and rapidly changing world of online media is tough for a freshly minted MBA who went to school to learn this stuff – it’s simply impossible for the average local business to navigate.

Clearly this presents a problem to a large and growing segment of the US economy.  Interestingly, a solution has emerged in recent years and Search Initiatives, Inc. is leading that revolution.

Most local businesses don’t value “clicks” to their websites, “likes,” “tweets,” or “reviews.”  Most would much rather get a telephone call from a potential customer looking for a quote or to schedule a service.  People certainly do research online but when it comes to get serious about the project at hand many shoppers would rather speak to the company involved.  That makes the 100 year old telephone a critical part of the new media economy.  Local businesses have figured out that rather than pay a marketing company, yellow pages or newspaper for websites or clicks they would rather pay for calls from potential customers.  Those customers may well have come from ads seen on search engines, social media even banner ads…but that’s not the concern of the local business who only pays when the phone rings.  Those businesses are more than happy to pay a premium for those calls.  A dentist may pay $40 for a new customer a home security company may pay over $100 for a call from a potential client because they recognize at a profound level that the potential customer on the phone is a much better prospect than any other kind.

Interestingly, these local businesses are still being sold to by the same yellow page or news print reps but instead of just selling print they are being sold online visibility packages which typically include a website, social media management and most importantly a certain number of leads delivered by tracked telephone calls.  This has driven a massive growth in the “Pay per Call” industry and Search Initiatives is leading that sea change.

Local businesses need to advertise, yet they are unable to navigate the complex world of new media effectively.  There is a pent up demand in the form of the billions of dollars which have fled traditional print media and have not yet found a place in the new media world.  What Search Initiatives does is use the complex and challenging tools presented by new media such as SEO, SEM, RTB, FBX, PPC and a dozen other acronyms which you will hopefully never have to come to terms with to drive new customers to local businesses via the paid phone lead.  It’s a concept which any local business can understand and embrace.  They only get changed if a potential new client is brought to them…if we can’t deliver we don’t get paid.

Search Initiatives has deep roots in new media and local business.  We work with the people who sell to local business to deliver the calls they need.  That means we have almost no cost to acquire a new customer.  Our millions of advertisers are managed by our marketing partners.  They provide all the customer support to our advertisers.  That leaves us free to focus on what we do best; driving thousands of valuable leads to local businesses in massive volume.

This new version of local advertising uses the kaleidoscope of new media to drive customers to local locations   Search Initiatives is ideally placed to be the one stop solution for all things local.  It’s a multi-billion dollar opportunity which represents the last green field opportunity in new media and Search Initiatives is ideally placed to lead that revolution.

Google Cleaning House on Download Guys

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The download space has been a lucrative area for many years. Cain slew Able because Able had downloaded some stuff onto Cain’s PC and given him a Malware browser infection. Way back in the day, it was possible to covertly get a browser object onto a end users browser, then traffic ads against it from Google amongst other folks. In the mid 2000’s, Google started getting more and more stringent on what they would approve before they would power a downloaded app with their search results. Each change made it harder and harder to get a Google feed to monetize with.

In the new privacy rules announced by Google earlier this month, they have pretty much put a stake through the heart of anyone relying on Google to monetize their downloads. The changes are pretty sweeping; a download must:

  • Be pre-approved by Google
  • Offer one-click, complete uninstall
  • Provide clear, full disclosure and transparency to people about what is being installed and what changes are being made to their devices
  • Install itself on only one browser per download
  • Be bundled with and distributed by only reputable parties who comply with our policies.

As barriers to entry go, these are so high as to be visible from outer space. The download guys have always been uneasy bedfellows for Google, and these most recent changes have essentially kicked them out of bed entirely. I’m sure it’s theoretically possible for a toolbar to get approved and maintain a user base under these conditions but it’s an uphill task.

On the grounds that even the blackest cloud has a silver lining this should be good news for Yahoo. The download guys will pretty much be forced to move their traffic to Yahoo who will be happy to monetize at a lower rate than Google, and at a worse revenue share. It won’t kill the space… it’s far too lucrative for that, but it will make it tougher to do any kind of business in volume. It makes me nostalgic for the good old days of 2003.

“Twas the Blog Before Christmas”

It’s nearly that time…I don’t think I’ll be posting much over the break, so here’s what probably amounts to my final post for 2012. Looking back over close to 100 blogs throughout the year it’s striking (to me anyway) just how much happens in our space and how much that impacts the real world around us.

This year we have seen mobile usage and commerce explode worldwide but especially in the US. We typically lag the front runners by a year or two and this year mobile finally made it happen. Over all mobile search volume went from less than 10% to (by some reports) closer to 25% of traffic and it’s possible that mobile will outstrip desktop next year..a full year earlier than expected. At the same time local traffic grew dramatically. That’s perhaps not that surprising given the growth in mobile, but as the guys who have been saying that local is the next big thing I take a certain amount of satisfaction in the 30-50% local intent query numbers we are seeing.

2012 saw the reshaping of social after the debacle of the Facebook IPO. There is still a lot of opportunity in social and more recently there has been some encouraging data on how social may eventually monetize. What I find most intriguing is the idea of using social signals from the relatively few who do engage socially with a product or service to generate a profile of what a customer might look like then target that potential customer in volume through search and social media….it’s complicated and sometimes slightly creepy stuff.

In 2012 Google continued to rule supreme in spite of multiple assaults for “evil” behavior at home and abroad. As I type the FTC is wrapping up it’s investigation into Google and it looks like big G will skate unharmed on their home turf, they may yet have a tougher job convincing their tougher critics in the EU. I feels like almost every day there is some new announcement or development which makes out engagement with the real world as expressed through the virtual world of search and mobile deeper, richer and sometimes scarier.

The world we serve, that of driving new clients to huge numbers of local businesses through search and all kinds of new media has become both more exciting and much more complicated. Given the plethora of media the choose from (search, SEM,SEO, social, local display and mobile to name but a few) and the continued decline of traditional media it’s becoming almost impossible for the average SMB to navigate that complexity. We solve for that by using all those new media on a massive scale to drive the high quality leads the local businesses need. We spent much of 2012 developing the machines needed to make that happen reliably and at scale, 2013 will be the year that hits big.

On the grander scale our industry has enabled revolution and reform and has been attacked by tyrants around the world. We have created enormous amounts of new wealth (and destroyed quite a bit with Facebook). Search is becoming pervasive and in some ways invasive. The mobile device is becoming the prime way of engagement for many more activities and with recent developments in both Apple and Android location based commerce (L-Commerce) will likely become ubiquitous in 2013 changing our world yet again.

For my self, on Leap Day I married my last and final wife, saw my oldest son graduate college and working with our team of hard working, inspired and inspiring people we reshaped our business to lead the upcoming local revolution. I trust your year was equally happy and productive. I wish you and yours a wonderful Holiday Season….Merry Christmas to all…. and to all a good night.

Welcome to the Jungle

Advertising has always been tricky when it comes to regulating the grey areas at the edge of media and freedom of speech. Search is rapidly following down the same rocky path and tripping over mine fields.

In the happy early days of search, it seemed that the search was in some way different to the real world — a Wild West where the rules don’t apply. The search guys, such as Craigslist, happily carried ads for everything from escorts to prescription drugs available without prescription from outside the U.S. But things have changed as time and lawsuits have rolled by.

For example, search for “Viagra” on Google and you will find only the manufacture’s site and a prescription-only supplier.  Similarly, the query “escort service” yielded ads for online “dating sites,” but not ads for escort companies.

The other shoes continues to drop: At the end of last year, Google set aside half a billion dollars to avoid prosecution for allowing ads for prescription drugs available from outside the U.S. without prescription.

More recently Google has come under fire from the Senate for possibly facilitating sex tourism and human trafficking under the guise of ads for dating sites. Google understandably doth protest, but some such things will inevitably sneak through.  While the ads are mostly gone for these kinds of services, the actual search results are still packed full of sites that offer all these services.

The recent failure of the SOPA legislation, which attempted to make search engines the guardians of intellectual property, has shed an even stronger light on the whole topic of illegal content and how it’s exposed through search.

There are countries in the Middle East that hand filter results to limit its own people’s access to any kind of politically sensitive or adult content. Similarly, China has waged a proxy war with the search engines to the point where Google withdrew entirely from the market last year.

In a recent interview with the Daily Mail in the U.K., one of the founders of Google, Sergey Brin, lamented the increasing intervention by governments into what was formerly a geeks-only world of search. He also took a swipe at the more proprietary approaches employed by Facebook and Apple, hypothesizing that had Google behaved liked Facebook there wouldn’t have been a Google as we know it today.

It’s fascinating to watch the two worlds of regulation and self-interest collide. In today’s world it’s much harder to restrict information than it ever has been. Yet, if a government tries hard enough, recent examples show that it can be done. Alongside the political interests of governments lie the business interests of the online giants, that much centralized power tends to corrupt. It will be interesting to see if there comes a time when the interests of those formerly opposing forces overlap and reinforce to the detriment of us all.