Making money: patents and phones

Although these two articles ended up being some time apart, I planned them to work together to explore just what's going on with the money side of the smartphone world. The mobile carriers are hugely profitable: several years back I worked out that in the UK they contribute as much to GDP as the oil and gas industry (for the UK that includes BP so it's not small, depending on the side issue of tax regimes - which applies equally to Vodafone) and as an ex-Ofcom analyst mentioned to me recently, they expect that to keep the political discussions away from them. Hah.

The handset makers make money: at least some of the time - Motorola has been posting a loss for a while (digression: has anyone considered that Google could be buying debt the way RIM did with the Nortel patents?) - but Apple's profits dwarf everyone else. Google makes money - a billion a year from mobile ads. Qualcomm is practically minting money, with fees on every phone for CDMA chipsets; the GSMA is at least distributing those fees between a variety of companies.

And then there's the whole OS situation: Android is free (as in puppy, I always say), Windows Phone has a licence, Symbian can't give itself away, BlackBerry is proprietary, Bada is coming up on the inside straight. Microsoft has patents (but has only ever started seven patent lawsuits), Nokia has patents and sues freely, Apple has patents but is getting sued as well as suing - and the Google situation is like a catherine wheel of implications sparking off in all directions.

So I was delighted to get two articles to really get my teeth into the situation - and to be reminded that putting a figure on any of this is impossibly hard because it's nearly all commercially confidential and the fees vary depending on who has what in their hand.

Microsoft's Patent Masterplan

Who makes money from mobile phones?
I've been writing quite a bit on Office 365 since the launch, from this interview with the MD of Microsoft UK and the executive behind Lync about why it's different from free cloud tools, to this (lengthy) comparison to the Enterprise version of Google Apps for IT Pro.

Office 365 is compelling in several ways and it wins hands down in one specific situation; where you're not putting everything into the cloud and you already have Microsoft IT in your business. I've also been thinking about the implications of this hybrid approach.

Lead on cloud - or the business will work around you: my view on why Microsoft's view of the cloud is one of the more pragmatic approaches, written to accompany my interview with Kenon Owens about System Center 2012 where we decide "IT departments can't ignore the cloud. If they fail to deliver systems that are fast and easy to set up, business teams will just sidestep them and sign up for a cloud service — whatever the consequences for security or compliance".

Talking to Microsoft execs about that view of cloud, I got a nugget about the way Microsoft runs the business that I hadn't known before. Microsoft execs: paid by results
A first look at the Google Music service and why it's more about teaching the Google Machine Learning System and less about giving you tunes

Android@Home: what you need to know about phone control and giant mazes
I'm fascinated by the reactions to Google's Chromebooks: lots of people who would scream blue murder if you put a thin client on their desk are delighted at the idea of an even thinner client as long as it looks like a laptop and lets them browse the Web (wait till their IT team locks down the sites they can browse with the usual firewall controls to see if they're still keen). I've already said that Chromebooks are a wakeup call to the Windows team to remove complexity, and my interview with Google's Rajen Sheth is up on ZDNet now and getting lots of comments. I've blogged some extra details on Chromebooks for business there too (like - can I cancel after six months?).

I'm not going to reprise my thoughts that the cheaper TCO Google claims also applies to Windows when you do the same desktop management or that adding another platform with no third-party integrated management tools doesn't necessarily reduce management costs overall (now you have users in both Chrome config and Active Directory to deal with separately). Instead I'll speculate wildly about why the Chromebooks are Atom and not ARM processors. Obviously Intel loves it - it emboldened Renee James to make some wildly inaccurate attacks on Windows 8 on ARM that Microsoft shot out of the sky - and I suspect you need the Intel processors to get Flash running at a decent speed along with the rest of Chrome. But mainly it means Samsung and Acer don't have to eat the cost of tooling to set up a new line to make boxes that may or not sell; they can just bang out a standard PC motherboard and laptop chassis and let Google worry about drivers and making a true netbook not look like a chocolate teapot when you don't have the bandwidth or battery to be online (on ARM tablets it's the screen that uses the majority of power, on a PC the Wi-Fi is a bigger consumer - I've yet to discover what uses most power on a Chromebook). Until every Web app I want to use works offline, Chromebooks won't be useful disconnected, so everyone should finally get offline Gmail.

Why Mobile Firefox hides the user interface: Mozilla design principles

Hotmail makes your mail more active: new active views for comments and deal

Google's view of shopping is personal and digital (and contactless and tracked and possibly now sub judice)

What will you get in Windows 7 Service Pack 2? And will you need it?

What IE10 means for Microsoft and Windows 8: Microsoft backs Web standards, especially the ones it plans to use for Windows tablets

Hands on with IE10 platform preview: improvements don’t stop with IE9

Microsoft’s stealth move on TV - Why Microsoft TV isn't making the same mistakes as Google… or Apple

(Note; I know that some of the folks on the Google TV team take a different view; we had a long discussion where I said ‘yes, but’.)

Windows Phone Mango: what you need to know and what you get

Interview with Microsoft’s Matt Bencke: what does Nokia mean for Mango? Cameras and international maps and mainstream users…


In one sense, Danny Sullivan publishing a story about Google accusing Bing of copying their search results on the eve of the Future of Search event that Bing is co-sponsoring that derailed the entire discussion on search quality and became a running joke throughout the full event - without giving Bing time to give a full response - is perfectly innocent. Google pitched the story to him the previous week but he didn't have time to get a briefing earlier so he ended up writing just before the event.

When you have a good story that you want to tell, from a good source, you want to publish. You might get scooped, you want credit for breaking news, there's even an element of excitement in getting the story and putting it straight out. There's a reason it's called breaking news.

But that's not why Sullivan says he posted when he did. He seems to be saying he posted straight away because Google wanted him to. "Yes, they wanted the news to be out before the Bing event happened — an event that Google is participating in. They felt it was important for the overall discussion about search quality." They didn't feel it was important for the overall discussion right after they did their experiment (which Shum calls a form of clickfraud; the gloves are off in this argument), which gave them results on Bing at the end of December; Google didn't offer Sullivan a story on what they called search relevancy until January 13th. And they didn't approach Microsoft to ask what was going on; they went straight for the publicity, right at the time of the Bing-sponsored conference.

And while I agree with Sullivan when he says his site isn't there to do PR for Google or to do PR for Bing, I think he just did do PR for Google by letting the source dictate the timing of the story. And as the executive editor of the New York Times put it just last week when talking about Julian Assange: "The relationship with sources is straightforward: you don’t necessarily endorse their agenda, echo their rhetoric, take anything they say at face value, applaud their methods or, most important, allow them to shape or censor your journalism. Your obligation, as an independent news organization, is to verify the material, to supply context, to exercise responsible judgment about what to publish and what not to publish and to make sense of it."

(And no, I don't think it's the same as taking information under an NDA - NDAs say I can't write about the topic before a certain date but don't force me to publish as soon as I can , although they do encourage it).

By serving the agenda of the source, you miss some of what the story could be. I've lambasted Microsoft for not joining the conversation by giving comment on some stories, but you have to be realistic. When you ask for comment on a big, controversial story on a day when some of the senior people in the team you're asking for comment are preparing for a big event and it's not something they already have a view on, you're probably not going to get a very detailed reply. I've asked fairly complex technical questions that have taken weeks working with the developer to get an answer on, because they literally didn't know what was happening. Unless this was a Sekrit Bing Plot All Along*, (in which case I'd expect there to be been a plausible denial on file ready to deploy), someone at Bing is going to have to look at the claims, find out what's happening inside the engine, find out why it's happening and decide what the policy is on that and what to say about it. And they have to work around whatever they had scheduled for that day, which just happens to be the day before the event when they're likely to be pretty busy preparing from.

That's pretty much what Sullivan seems to be saying happened. "Bing was allowed to have as much input as they wanted. I contacted them early on Monday morning, when I started working on this. I received a reply around 3pm Pacific, which I included in this article. That’s all they wanted to provide... I went out of my way to follow up even though I’d already been given a statement... [the spokesperson] said it was likely they’d have more to say when I see them after the event today."

If Sullivan had waited to post, with Bing's flat denial (kudos to Mary Jo Foley for getting an unambiguous quote to go with the explanation) and the extra details from Harry Shum's post, the article might have been less punchy (it wouldn't have had the line 'Bing doesn't deny this' in the first paragraph) but it would have been better journalism.

Would it have been a letdown after the Farsight event? Hard to say because without the article the discussion at the event would have been entirely different; the stories might have been about what search engines can do in the future rather than whether they're playing fair right now. I think a 'did they cheat' article would have had as much impact after the event - but it wouldn't have given Google the same level of exposure for the accusations and it wouldn't have turned an event that Bing had sponsored as an open forum for many different companies in the search arena into an open sparring match. This is pretty much journalism as spectator sport, and I like to think our profession is better than this.

* On balance, I don't think Bing was deliberately taking search results from Google; I've met enough Bing folks to believe that they they're smart enough to know that if they did that, they would get found out sooner or later and they'd face exactly this kind of backlash. I think they're getting those results from Google exactly the way they say they are; by mining user data, and no-one ever thought to go in and censor the Google search strings in there. Maybe they should have. (Maybe Google should filter out a lot more of the content spam sites that make money from Google ads before they get complaints about them rather than waiting until the results are so polluted that people complain; everyone is making a judgement call on these issues). I agree with Shum; Google uses user data (like the content of your email in Gmail) to apply ads, the Google toolbar has a long EULA just like the Bing bar and the IE 8 suggested sites feature - and as I've said a lot recently, when the service is free the users are part of the product being sold. Bing is trying to get better search results by looking at the pages real people visit - I wonder if the reason that only 7-9 out of 100 honeypot terms made it into Bing is something to do with the behaviour of the Googlers baiting the sting? - and real people use both engines. Maybe what the 'sting' actually reveals is that search results have a massive influence on where we go on the Web, and that is the point at which the search engines needs to take responsibility for the results they provide.

Google TV: not ready for primetime

I review the Logitech Revue Google TV for TechRadar and decide it's too much Google and not enough TV
It should be whether Google parlays its dominance in search to get deals outside search that it uses to reinforce its dominance in search.

I know tying is a key part of monopoly abuse, but I think reinforcing is more important. Take the deal where Google translates the patents for the European Patent Office; it gets paid, it gets to index the data to extract knowledge it can use in the search algorithm and it gets parallel documents it can check and then use to improve its translation algorithm (I'm just assuming the translations will be checked because even in a closed domain, unchecked machine translations of patents sound like a lawsuit waiting to happen).

It's not a crime just to be big; the issue is what you do with your size and whether you do things that unfairly keep others out of a market.

Everything Google does in all areas of its business (apart from possibly Google Apps in enterprise and government, and it may apply there too) is designed to either put Google ads in front of more searchers on more platforms or to give the Google search engine more training data in order to improve the search engine that puts ads in front of searchers.

Gmail, Picasa, translation, the Google Maps sensor probes you have to take to put Android on the phone you sell – they all get more data for Google to crunch. Their business model is transforming the information of the world into a source of targeted ads. By having a bigger index, Google gets to have a bigger training set for its engine. And how much it promotes its other services that funnel training data to the engine has to matter as a question of reinforcement; the circular nature of what Google is doing doesn't work in isolation.

What's MeeGo for?

I've always said that the main reason Intel develops Moblin is to scare Microsoft; any time Redmond isn't playing ball, Intel holds up Moblin (I can't bring myself to call it MeeGo every time) like a scary hand puppet and waves it around until the 'softies cave in. Perhaps they haven't caved recently (or perhaps my utter speculation about Windows 8 on ARM is near to the bone), but Intel spokesperson James Reinders made some remarkably candid comments about Microsoft and Windows performance on Atom (twice, so it wasn't mis-speaking).

Personally I'm very happy with Windows 7 on Atom (in as much as I'm happy about Atom at all - I like the battery life but tend to hate the tiny keyboards), and I'm grateful that Windows VP Steven Sinosfky went through what must have been the pain of using a netbook as his main PC for months to make sure Windows 7 would make me happy (oh, and all you other Atom users too), but it did remind me that Origami died a death. Of course now that I know that Microsoft worked with Toshiba to create the nice, simple Media Controller interface on the JOURN.E Touch and that they brainstormed the 'three screens plus cloud' mantra together I'm wondering what we might see on the Windows 7 tablets that HP and, I think I can say, Toshiba will bring out this summer. 

Reinders also talked about Atom and embedded Atom in a way that made me think that Intel is trying to use Moblin/MeeGo as a scary puppet to wave at Google as well; Intel thinks embedded devices - smartphones, MIDs, what Qualcomm calls SmartBooks even though that's a trademark in Europe,in-car systems and all the other devices that are going Android and Chrome (or maybe RIM or - very successfully for Ford - Windows CE or, of course, iPhone and iPad) - need a better operating system. I'm inclined to agree - though of course I personally think it should be some variation of Windows 8 (I do seem to have a theme this week) rather than Moblin/MeeGo. But what I mostly think is that if Intel is using the same puppet to wave at both Google and Microsoft, then they are certainly wearing what an old friend of ours calls the Brave Trousers.

You can be too real time: Google vs Bing

snark maiden
Back when blog search was a big thing, we did the rounds of various blog search startups in silicon valley; I was finding that searches on Google were dominated by what was new rather than what was authoritative and useful and I was interested to see if blogs were being seen purely as fodder for ADD-like surfers wanting just novelty or as a lightweight publishing system for building up a corpus of information. Is it, like the teenagers who caught on to text messaging first, just another way of saying 'what are you doing now? now? now?' or will we want to go back and look up recipes and travel diaries on personal blogs, tips and guides on technical blogs? Eventually, Google pushed the blog results back down into the general mix, where they belong - but now it's Twitter dominating the results.

Take 'mike siwek lawyer mi'. Steven Levy got an unusual level of access at Google, and covers the different stages of what Google has used in its search algorithm over at Wired. He does it rather uncritically; it's a piece about Google not an analysis of the state of search and he skips technical analysis of Bing in favour of colourful metaphors. One of the the things he quotes is Google's claim to do better on a specific search as an example of how it's better on names than Bing; search for those four words and Google thinks you want a lawyer in Michigan and puts him at the top of the list, Bing, says Levy, doesn't get him for several pages. But search is a work in progress; Bing now has several ways to find the lawyer in the first few results,  including directories of lawyers. What does Google actually find tonight? A lot of references to Levy's article, to tweets about the article - and no link on the first page of results that brings up the man himself.

No single result is a good test of search; I keep both Bing and Google as search providers and maybe one time in ten Bing doesn't give me what I want and I repeat the search on Google. I'm sure in a  few days, Mr Siwek will bubble back up on Google. But Bing's results aren't broken by those 'more important because they're recent' stories the way Google's are; there are links to Levy's piece but it doesn't assume that's all you want. I suspect that's a different emphasis in the search tuning and usually, that's more useful. There's a whole range of what makes things interesting and novelty isn't the only measure.


full steam ahead
Mr No Privacy has spoken again; no-one was harmed by Buzz (having your abusive ex find out where you work isn't harm, is it?) and we were all just confused about Buzz. Our bad, for worrying, eh? 

And when the Buzz team said people were 'rightfully upset'? Nothing like responsibility going all the way to the top, is there?  (and this is nothing like...)

A Buzz allegory, with spam

cat smile
In this analogy, you are the hog...

I don't grant the conclusion but the premise of this little story is excellent; for a free online service, users are not customers - they're ingredients for the business model

The hogosphere reacts to Buzzsaw

thanks to ackicif for extracting the URL - I have no idea why the lj web interface borked the link because I didn't write the HTML by hand!
snark maiden
Action on Author's Rights points out that to the government, authors wanting to be paid for their work and control their licensing is seen as a 'logjam'.

"The governments of France and Germany sent briefs to the court urging the rejection of the settlement. The government of India made diplomatic representations to the government of the United States.

In recent weeks, the sorry truth has been emerging: in Britain the New Labour government supports the Google Book Settlement, and has done from the start."

If you;re wondering about the point of view of the author - rather than whether it means you can get cheap ebooks - have a read of


Mapping California by lidar
Originally uploaded by marypcb.
A German group called the Free Art and Technology group put a GPS tracker on a Google Street View car: they pranked the driver, and, in one case, filmed him urinating against a streetlamp (this link NSFW if you dislike four-letter words).

It immediately made me think of taking this photo as we passed a mapping car near Davis, California; the driver looked at me as I took the snap and I wondered 'is it an intrusion of privacy to photograph a camera car?"
snark maiden

Early adopter: check. (Well, I think it's more fostering, given that I don't keep most of the tech I try out; journalists - fostering today the tech you'll want to adopt tomorrow?)
Shop at Walmart: sometimes. Their clothing line has some nice stuff sometimes, but I'm more of a Trader Joes/Whole Foods gal.

Am I more a Google searcher? Target and Amazon? Well, I bought a dinner set at Target and dragged it back from Cincinnati... certainly not a Yahoo users and my views on AT&T are, well, frank... (capex down in almost direct proportion to increasing revenue? file under shortsighted)

AdAge has some fascinting demographics from a study by Wunderman ,BrandAsset Consulting, Zaaz and Compete: I'm not sure about the search engine users but they are *spot on* about the AOL demographic; that chip on the shoulder, 'I'm comfortable here and I'm staying but shouldn't there be more' attitude - they have always been the core AOL audience. They were often obscured by the transient wave of people using AOL as training wheels to get online, check out the walled garden and hike out into the wild Internet. Part of me is thinking I'd never want to build a brand on that demographic, but if you can pitch them, keep them and sell to them - why not? The problem for AOL is that it's a market that isn't sexy, doesn't look good in headlines and somewhere along the line tech and online services have become all about what looks good in the headlines...

What Your Choice of Search Engine Says About You

"What does your search engine say about you? Well, if it's Bing, you're probably an early adopter, but you also visit, shop and ultimately make purchases from Walmart more than other search-engine users. Google searchers, on the other hand, are partial to Target and Amazon, and Yahoo searchers have a strong preference for wireless service from AT&T and Sprint.
Google users are more likely to book a flight online at JetBlue or make a reservation on Hotwire. They are also more likely to do research on a Lexus, while Bing users tend more toward Toyota.
For instance, AOL customers feel less intellectual than their peers, are 55 and older, spend their money more responsibly, want to blend in to the crowd, feel like they've gotten a raw deal out of life, expect less from their future and, believe it or not, still use dial-up modems. Bing users are middle-aged, highly educated tech-savvy individuals who consider themselves to be average and spend more than 10 hours a week online.
Googlers tend to be the average internet Joe, according to the study. The search leader's loyalists are conventional people yet open to trying new things, believe in following rules and don't consider themselves any smarter or less intelligent than the person next to them. Yahoo users tend to be 55-plus, reserved and a less-independent group with little faith in imagination. They feel they have little control over their future and are skeptical and cautious of new or untried ideas."

snark maiden

"Google told me today that they would consider giving more transparency about revenue splits in Adsense.

At a private meeting with a dozen and a half media people at Davos with CEO Eric Schmidt." Buzzmachine doesn't flag that as irony ;-)

Aside from some pointless though amusingly-phrased Microsoft-bashing and the acceptance of everything Google says without (reported) question, this has some interesting snippets.
On China
"When is Google going to do something? “It should happen soon,” Drummond said." Alan Rusbridger has a rather woollier response from Schmidt: But then the shutters came down. He was not going to talk about the schedules of any talks, or dates, or times, or indeed anything at all about them. Supposing they were happening. He restricted himself to the observation: "It's not clear that the book has ended yet. This may just be the first chapter. It's not a permanent outcome on the facts we've presented to you. Maybe it will change again. It's possible things change. Things change all the time."

Google and privacy again

snark maiden
How do you turn off the 'enhanced' option on the Google Toolbar, if you don't want your URLs reported to the mothership? Disturbingly, suggests you can't unless you uninstall the toolbar. It's kind of like a roach motel for URL privacy and the notion of a temporary option to disable tracking that doesn't work until you restart the browser (when the tracking will restart) is an exercise in Kafka-style logic...

Maybe I should have a privacy_rant tag to save time...
The UK is Google's second-biggest search market. But Google doesn't pay any tax here: it's all taxed in Dublin where the tax rate is far lower. There are plenty of complaints floating around saying Google's bending its 'don't be evil' principle by this, but it's common practice in business to place things in countries that give you tax advantages for your business. Google is also incorporated in business-friendly Delaware, where there's a whole separate court track for business. What it says is that Google is a business, not a public service or a warm fuzzy free information provider and we'd do well to remember that when evaluating it...
When Google paid them to put the Google Apps on there. cf turn-by-turn navigation and 'less than free'...

Google news by author

Google now lets you search the Google News results by author. How well does it do?

For me
it finds recent IT Pro posts, and a story on The H in the current results; in the archives it says it goes back to 1998, though the first story is from 2007 and the second, though marked as 2008 is actually from 2004 (the disclaimer at the bottom says 'Dates associated with search results are estimated and are determined automatically by a computer program'). 1998 marks my time at AOL, when I was quoted in press releases as well as writing about them; 2002/3 has me in Computing, reviewing on Amazon UK and writing for the Taipei Times (it's actually a reprint from the Guardian) about the first flood of spyware. By 2006/2007 Google has a lot more of my writing - for some reason November 2007 was a very quiet month. For 2008/2009 it includes my annual company report (who thought that Experian would be a news publisher rather than a primary source) and it doesn't find any of my articles on TechRadar or Tom's Guide. I'd say maybe 60% of the articles that I write that go online are being picked up as written by me, so I'd give it 6/10.

It did find a few stories that turn out to be about me, at least peripherally; made me chuckle...

My friend Peter asked me over lunch on Sunday how Simon and I advertise our blogs, because he's starting to blog more and wondered how to attract readers. Peter gets a page on Wikipedia and he's interesting to read (go argue with his latest post about whether Linus supports DRM), but he noticed that the post he wrote that got picked up on Boing Boing got a lot more comments than other, very similar posts (indeed, when you search for him on Google, you get, in order, the Wikipedia link, a ZDNet blog, his Linked In Profile and a link to just that post).

'I don't bother with SEO,' I said; 'I'm mostly talking to people who are already listening.' Which probably indicates a certain lack of ambition. SE-what, he replied? Well, now I can point him at the SEO-by numbers explanations in this blog on IT Pro, which sums it up as lots of links, phrases people will search for and keep the sentences short so the spider can understand them. There's a company raising venture capital on the basis of promoting link journalism, where you annotate links to other online articles to synthesise the evidence and put your own view in context (kind of an accessible annotated bibliography). And the blog also links to a superbly subtle column by Charlie Brooker for The Guardian that criticises the practice of shoehorning in irrelevant mentions to Britney Spears and Angelina (and of course, in the process, includes them often enough to squeeze out the very Google juice he's decrying).

The comments seem to rather miss this parodic point and criticise the column for being too ivory tower. 'No one is stopping you from having a beautifully crafted article that no one can find,' says one but then claims we need to optimise the superior content to make it stand out from the masses. Quite how pumping it up with the same search steroids will do this, I'm not sure. I  know SEO works well enough for people to pay for it, but much of it strikes me as the Emperor's New Clothes of the Web. If everyone with a site on topic X optimises it with the right keywords, how will any one of them stand out? And isn't it actually about making it easier for us to stop assessing the value of sources ourselves, to stop seeking out good writers and just listen to what shouts the loudest and flashes the brightest?

Very little writing is pure, self-indulgent art - except, ironically, blogs. Anything that's written for publication has to make a point, fit a format, reach a reader (yes, alliteration and metaphor help). The length of fiction - flash, short, novella, novel, series - dictates both the depth of plot and character and the structure of scene and climax. News stories have to read from the top and cut from the bottom so you can fit what matters on the page at the last minute - call it a dying art, but more people in the UK read UK newspapers on paper than online. Sidebars and other page furniture break up a magazine article; they're called page entry points because they can get you to start reading, but they can also give you a break from following the thrust of the article and let you absorb it before you return to reading. Any piece needs to speak to its audience; if I pick up a romance, I'm not after the gritty, indulgent gore of true crime. So you can't say 'it's art, I shouldn't have to care about the demands of commerce or prostitute my pure writing to structure'. But much SEO structure is banal and reductive and lazy and lowest common denominator in a way that other writing structure strictures aren't.

What about good SEO structure? Probably, I've seen it and not known I was seeing it. Maybe, like any other writing craft, ars est celare artem.

One of the reasons why I resigned from AOL to go freelance was the trend away from producing and commissioning our own editorial content and towards placing ads around partner content; it became a bizdev and production job rather than an editorial one, and that's not what I really do. AOL UK had an editorial director at the time, Andy Bull, whose management style I found a little abrasive. He left abruptly after giving an interview to the Media Guardian in which he said rather too frankly that he wasn't a fan of Harry Potter; as this was just before the first movie came out, in which Time Warner had invested $BIGNUM, that might have been the reason. I don't think it was because of the comment I personally disliked, that "advertising is content too"*.

The holy grail of online advertising is contextual ads that speak to your needs as an individual, at the time you're most ready to buy. Getting an offer for cut-price flights when I'm ready to book my ticket home from Orlando should be a win for both of us. But the baby steps along that road tend to be annoying (Gmail gets like Clippy: "I see you're breaking up with your girlfriend - would you like help with relationship counselling?"). And AOL had no contextual information about the user; they put wedding-related ads in the Wedding area and PC ads in the technology channel - it was just themed advertising.
Google can probably do a little better because it can mine your searches and your history and your email and all that information you publish about yourself in those memes you do. And you should get used to advertising 24x7 everywhere you look online courtesy of Google, and be thankful. Because Eric Schmidt is reminding me of that content comment. As he said to an interviewer from CNBC at the Milken Conference: "Google believes that advertising itself has value. The ads literally are valuable to consumers. Not just to the advertisers, but the consumers."

He goes on to admit that yes, they've already made the classic AOL blunder about monetising social networks. AOL made very little money from the most popular areas of the service: chat. You see, when you're talking to your friends, you don't interrupt the conversation to take a sales cold call, you don't click through to an advert. Social networks are the same; you care that your friend has a new car; you don't necessarily want to go look at the slick video of how a professional driver made it look good on TV, still less see a deal to buy one yourself. Who's buying all those ads on Facebook applications? Other Facebook application developers.

Other Schmidt nuggets
On not buying back stock: We love watching that cash sit in a well-managed bank and not get lost.
The new consumerism: Everybody wants the same thing. They want fashion, they want information, they want products, they want e-commerce, they want it now.
On discovering that running a big company means having a Microsoft-style formal process rather than spontaneous startup energy, even when you're a small fraction of Microsoft's size: [the biggest challenge today is] the ability to manage the creative process, deal with the complexity in what is a relatively large company, in terms of people, who's doing what. We have 50 development centers all around the world, people in different time zones, `Are you doing that? Are you doing that? Do I work with you? How do I check in my code?'...The systems in the company, literally who's doing what, what are they doing, seemed to lag our ability to hire these great people.

I did wonder if even after all this time it would be unprofessional to mention why I left AOL or to discuss the public record of someone I worked with; on consideration I thought it would only be unprofessional to snark about it*. I think ethics in journalism matter. That's why I thought this comment in the CNBC interview at a conference last week was pretty low.
CNBC's Maria Bartiromo: Yeah, you can bet, I guess, who tipped off the DOJ about the phone call that was made, Steve Ballmer or somebody from that side."
Not only it is a very soft-pedal interview, that refrains from asking any difficult questions (like if the Google tenet is do no evil, are they doing the right thing in China, if the Google tenet is don't trap user data, why are they complaining about being told 18 months is too long to keep it for?), but an unsubstantiated presumption about Microsoft behaving badly shouldn't go out at all, let alone be given authority because it's said by a journalist.

*I don't think I'm snarking by saying that Bull's departure from AOL was also three years before his prosecution as part of Operation Ore so probably not connected to the actions that led to his conviction and jail sentence (and for clarity, he's not the Guardian sports writer Andy Bull), which you can read his take on; that doesn't mention his time at AOL, which was during those four years, and it doesn't say whether he was paid for writing that article. I'm processing my own reaction to finding out that he was one of the few people caught by Ore who hadn't had their credit cards stolen but was looking at dubious content. I find it a little disquieting, but I'm far more offended by his suggestion that ISPs and search engines share his guilt by not have censored the sites or otherwise taken over the responsibility for his actions he should have taken himself. 



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