Google Pressures Yellow Page Sector
November 4, 2008
When I was in France, the hotel Internet connection failed. There was no paper book of business listings. The print directories–hereinafter called yellow pages–are no longer available at my hotel. In Harrods Creek, I get a number of weird yellow page publications. I receive a listing of businesses in the east end of Louisville, but I don’t look at it. I think I have a listing of minority owned businesses as well. I also recall seeing a silver yellow pages. The idea for that directory was that I could find businesses that wanted to work with people my age.
My newsreader delivered to me a story which if true spells trouble for anyone in the yellow pages business not working with Google. I may be misreading this news story in the Sydney Morning Herald (Australia) here, so you can double check me. “Sensis Concedes Defeat to Google” by Asher Moses is a story that told me Google nosed into the yellow page business, disrupted it, and ended up with a deal that Sensis (an Australian directory publisher owned by the big telco Telstra) had to take or run out of oxygen.
Mr. Moses wrote:
Telstra’s Sensis has given up on competing with Google in online search and mapping, announcing today it would provide its Yellow business listings to Google Maps and abandon its own search engine for one powered by Google. From the first quarter of next year, all of Yellow’s business listings – the most comprehensive directory in Australia – will be stored in Google Maps.
Will Google have the same success in North America? In my new Google and Publishing monograph for Infonortics, I explain how Google is building its own directory of businesses and providing free coupons to help the merchants get traffic. Years ago I worked on the USWest Yellow Pages’ project. One fact I recall was that a surprising number of yellow page advertisers don’t like the yellow pages.
In my experience, when there is a potent free service that is better than the existing service, the better service will disrupt existing business processes and then supplant them. So, if Google squeezed Sensis’ owner to get its way, Google will probably find the same pattern repeating itself in other markets. In short, the GOOG will become the yellow page champion. It’s just a matter of time. Regulators have a tough time understanding what Google does or why any single action is a problem. Bananas are a monoculture I think. That’s no problem, but there is just one type of banana. I have a list of other business sectors at risk for a Sensis type play by the GOOG. No one seems to care. The Google is just so darn fun.
Stephen Arnold, November 4, 2008
Google and the Washington Post’s Use of the Word Monopoly
November 4, 2008
Does anyone care about the library market? There are some specialist firms, mostly stuck in the sub-$1.0 billion a year basement. These firms have been aggregated by Thomson and Reed Elsevier to create $7.0 to $9.0 billion revenues streams, but these outfits have been challenged to grow rapidly and find new markets. There is the leveraged Cambridge Scientific Abstracts, a company hoping that Google acquires it, giving the owner a big payday. And there is the dwindling number of highly specialized firms trying to survive in a world where library budgets are no longer automatically increased.
The Washington Post story by James Gibson “Google New Monopoly” leap frogs over the shallow analyses of Google “doing good”. Mr. Gibson goes to the heart of Google’s deal with publishers for book scanning. He wrote here:
By settling the case, Google has made it much more difficult for others to compete with its Book Search service. Of course, Google was already in a dominant position because few companies have the resources to scan all those millions of books. But even fewer have the additional funds needed to pay fees to all those copyright owners. The licenses are essentially a barrier to entry, and it’s possible that only Google will be able to surmount that barrier. Sure, Google now has to share its profits with publishers. But when a company has no competitors, there are plenty of profits to share.
I find this interesting and potentially troublesome for Google for three reasons:
- The Washington Post editors knowingly characterized the book scanning, optical character recognition, and the other bits and pieces of this Google operation as a monopoly. The way I read the word “new”, the Post editors accept as common knowledge Google’s possession of at least one other monopoly, maybe more.
- The companies in the library world are likely to face the grim prospect of Google picking off information domains one by one. Google already has a patent service, which is bad news for some vendors. Maybe Derwent and Questel will be okay, but the pressure will mount for smaller fish. Google for its part is probably unaware of the library ecosystem that it will disrupt, but the disruption has begun for Ebsco and HW Wilson unless these firms can innovate and pump revenues quickly.
- Traditional library vendors have largely failed to keep pace with technology and consistently priced their products so that most people wanting information cannot access these data directly. In Harrods Creek, I have to drive to the public library in downtown Louisville to access some information resources. Google is going to make more and more of this high value information available to me and others directly. Whether ad supported or on a subscription basis, I will buy from Google.
The bottomline, therefore, is that if one wants to make a case that Google is on the path to more than two monopolies, the Washington Post makes that story clear in my opinion. Frankly none of the traditional information vendors can slow or impede Google. Google won’t have to buy all of the companies, but it may buy one or two to get some expertise and certain content domains. For the rest of this small, but important industry, the writing is on the wall. Change or be pushed into the lumber room.
Stephen Arnold, November 4, 2008
Azure: Wit and Optimism
November 3, 2008
I enjoy the Register. The addled goose wishes he were British so his edge has that Pythonesque slant. The article “What Ray Ozzie Didn’t Tell You about Microsoft Azure” is enjoyable and informative. It contains a wonderfully terse description of Amazon’s and Google’s cloud services. The Google description is quite tasty with the spice of shifting the job of figuring out how to use it from Google to the user. Nice point. You must read the full article here. Despite the wit, the write up makes several significant points:
- The cloud is a ragout, not a cohesive system or strategy
- A developer has to deal with a large number of components
- Microsoft might pull this off because Ray Ozzie has worked in this for a long time.
My view is more conservative. I want to see Microsoft deliver before I get too excited or put odds on Microsoft’s chances for success. Google’s been working on its cloud services for a decade, and those are not without their faults. I couldn’t access my Gmail for a time, then my “ig” page was dead too. Whether you agree with me or the Register is secondary to the useful information in its write up.
Stephen Arnold, November 3, 2008
Azure as Manhattan Project
November 3, 2008
I usually find myself in agreement with Dan Farber’s analyses. I generally agree with his “Microsoft’s Manhattan Project” write up here. Please, read his article, because I can be more skeptical about Microsoft’s ability to follow through with some of its technical assertions. It is easy for a Microsoft executive to say that software will perform a function. It is quite a different thing to deliver software that actually delivers. Mr. Farber is inclined to see Microsoft’s statements and demos about Microsoft Azure as commitment. He wrote:
Microsoft’s cloud computing efforts have gotten off to a slow start compared with competitors, and it’s on the scale of a Manhattan Project for Windows. Azure is in pre-beta and who knows how it will turn out or whether consumers and companies will adopt it with enough volume to keep Microsoft’s business model and market share intact. But there is no turning back and Microsoft has finally legitimized Office in the cloud.
My take is similar but there is an important difference between what Microsoft is setting out to do and what Google and Salesforce.com, among others, have done. Specifically, Google and Salesforce.com have developed new applications to run in a cloud environment. Google has many innovations, including MapReduce and Salesforce.com has its multi tenant architecture.
Microsoft’s effort will, in part, involve moving existing applications to the cloud. I think this is going to be an interesting exercise. Some of these targeted for the cloud applications like SharePoint have their share of problems. Other applications do not integrate well in on premises locations so those hiccups have to be calmed.
The big difference between Azure and what Google and other Microsoft competitors are doing may be more difficult than starting from ground zero. Unfortunately, time is not on Microsoft’s side. Microsoft also has the friction imposed by the bureaucracy of a $60.0 billion company. Agility and complexity may combine to pose some big challenges for the Azure Manhattan Project. The Manhattan Project was complex but focused on one thing. Microsoft’s Azure by definition has to focus on protecting legacy applications, annuity revenue, and existing functions in a new environment. That’s a big and possibly impossible job to get right on a timeline of a year and a half.
Stephen Arnold, November 3, 2008
Microsoft and Search in a Time Warp
November 2, 2008
In grade school in Illinois, I recall learning the meaning of the word anachronistic. For some reason, the explanation has stuck with me for more than 55 years. The teacher, Miss Chessman, told the class, “Ancient Greeks did not have an alarm clock.” The idea is that if you mix up when things occur, you run the risk of creating the equivalent of a dog’s breakfast.
My newsreader delivered CIO Magazine’s “Search Will Outshine KM” by Mike Altendorf to read. I don’t know Mr. Altendorf, and I have to admit that I disagree with a couple of the points he makes in this two part article, which you can read here. I am a tired goose, and I don’t want to trigger a squabble in the barn yard. I do want to point out where Mr. Altendorf and I part company.
First, the notion of search outshining KM is not something I have thought much about. KM is mostly baloney, one of those “trends” that promise much and deliver little that one can measure. When I watch intelligent people leaving one company for another, no software system captures what that person knows. IBM is trying to prevent a chip designer from leaving Big Blue to join Apple. If KM worked, IBM wouldn’t take such extreme action to prevent a person from changing jobs. That’s KM for you. It doesn’t deliver. And search? It is, in general, not too helpful either. In fact, search is one of the few software systems to engender a dissatisfaction rate among its users of 60 to 70 percent. In my opinion, search outshining KM is a silly assertion, and one that makes it seem that one lousy system can deliver information better than another lousy system. Both search and KM work best when applied to specific problems and bounded by realistic expectations and budgets.
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Second, the reference to Microsoft’s acquisition of Fast Search and Transfer and Powerset is startling. First, Mr. Altendorf makes no reference to the police action in Oslo that threatens to undermine the credibility of the Fast Search technology, finances, and executives. Second, Powerset is not complement to Fast Search technology for two reasons: [a] Powerset technology is part of the Live.com service and has not to my knowledge been hooked to the Fast Search system at this time and [b] notion that Microsoft can “tie together” disparate technologies is out of touch with reality. Let me be clear. Microsoft has compatibility issues within its own product families; specifically, SharePoint and the Dynamics range of software. When you toss in the Fast Search conglomeration of original code, the bits of open source Fast Search has used in its system, and the technology from the acquisitions Fast Search made prior to its purchase by Microsoft, you have quite a bit of integrating to do. Now add the Powerset original code with the licensed technology from Xerox Parc, and you have even more work. Microsoft’s units can’t make the ribbon interface consistent across Outlook, Word, and Visio in Office 2007. Mr. Altendorf’s blithely reassures me that Microsoft can work out these incongruities. I beg to differ.
Brainware: Nailing a Big Deal
October 31, 2008
Brainware won’t reveal the name of its client, but the “diversified energy company” bought $2.6 million worth of Brainware technology in October 2007. Brainware explains that this is a “follow on contract”. This size of this deal moves Brainware into Autonomy and Endeca territory, two vendors noted for their ability to land large search and content processing deals. Brainware describes itself as a vendor of “intelligent data capture and enterprise search solutions.” The firm offers what is called “end to end” solutions. Like OpenText and ZyLab, Brainware can put in place scanning and content capture and conversion systems, indexing, content processing, and information access tools. The idea is that paper or digital information goes in at one end of the system and the user can access that content at the other. You can read an interview with one of the Brainware executives here. I profiled the company in Beyond Search, published by the Gilbane Group. More information about that study is here.
According to the Brainware news release here:
This private sector oil company is deploying Brainware Distiller as a front-end data capture solution in conjunction with its global ERP rollout. The Brainware Distiller solution will process millions of invoice pages per year from more than a hundred different countries through their shared services centers located across Europe and the U.S.
A happy quack to the Brainware team. Now, what’s next for the Ashburn, Virginia, company? If you haven’t sold Halliburton, maybe you should aim for Shell or BP next? I found the announcement interesting because Brainware is associated with eDiscovery, not enterprise search, in my mind. Like Recommind, Brainware seems to be making an effort to penetrate new markets with its patented technology for information processing.
Stephen Arnold, October 30, 2008
Dead Trees–Cracking and Falling
October 29, 2008
I commented on the deal between Google and publishers here. I won’t retrace my thoughts. I would like to point to two news stories that presage what will happen in what I fondly call the “dead tree” business. “Dead tree” equates with paper. The “dead tree” people are those who print information on paper. Whether a newspaper or a conference organizer or a magazine publisher, the “dead tree” business model is suffering an ecosystem collapse.
Now the two news stories:
- The New York Times, PaidContent.org, and others reported that Time Inc. is reorganizing and chopping down 600 employees. Once getting a job at Time meant employment for a long time. Heck, the company has been trying to organize its photo collection for half a century. I think these layoffs will be little more than tender spring shoots in a riot of efflorescence. Summer, spring, then fall, if you get my metaphor.
- The Christian Science Monitor, according Business Week, the Washington Post, and others, is killing its daily print edition. I don’t recall a weekend edition, but I may be wrong. Whatever. The newspaper industry is waking up to the reality of the new era in publishing. I imagine the clay cuneiform crowd in Babylonia reacted the same way when folks turned up with papyrus scrolls. Goes with the territory in the information world.
Let me summarize several points that I have been dancing around in a goosey boogie:
First, the reason dead tree businesses are in trouble is that the business model no longer works. Costs are part of the problem. The Internet, as I wrote in my monograph “Publishing on the Internet: A New Medium for a New Millennium” (Infonortics Ltd., 1996), operates on different gears and levers than mashing ink on paper and selling ads. Alas, the monograph is no longer in print. It was one of my last dead tree studies. My new work is digital. I made the switch years ago.
Second, the demographics are against dead tree operations. I read books. I subscribe to four newspapers. I gave up on the Financial Times because the UK based outfit could not even mail the paper to me on a regular basis. The 12-year-old next door doesn’t look at newspapers. The junk mail and the newspapers go straight into la poubelle. Not a glace she gives them. Newspapers to her are the equivalent of baloney from charities, pizza delivery outfits, and yard service operators looking for work in Harrod’s Creek, Kentucky.
Third, the content is not longer intermediated by gatekeepers in New York, London, Madrid, and Paris. When Time nukes people, that action creates a number of new bloggers. The result is that there are more people motivated to generate content. We just tallied the numbers of Web logs, calculating about 120 million Web logs, with a confidence of 15 percent. Google alone has more than 80 Web logs. How can a handful of people keep pace with this outpouring of information in digital, crunchy formats. Dead trees don’t do audio and video. My neighbor’s daughter disposes of the newspapers with ear buds stuffed into her ears. The Craigslist.org listings for Louisville have eviscerated the Courier Journal & Louisville Times where I once worked, quite happily until the take over by Gannett in 1986.
Bottomline: will the intellectual foresters who print fungible information products figure out how to save the rain forest, or will these folks like the deer and squirrels here in Kentucky rush across the interstate when “developers” run bulldozers over the land to make way for new condos. Man, there are a lot of dead squirrels and deer on the roads near my log cabin. I will wait and see and be very careful cross the road.
What’s this have to do with search? When I cross the road, I check my Google Maps. You can’t find much information using my high school library. I checked last time I was in central Illinois.
Stephen Arnold, October 29, 2008
Authors, Orphaned Books, and the Kinder, Gentler Googzilla
October 29, 2008
On October 28, 2008, Google’s posted on “The Official Google Blog” a summary of a deal to assuage some of those aggrieved–even threatened–by Google’s Book Search service. You must read the posting here. Right from the git go, the Google Web log reminds me that Google’s founders wanted to make information in books available to the world. (I now see a red applause sign flashing in my addled goose brain.) Next I am reminded how Google Book Search helped millions, including those curious about the physics of Star Trek and wood carvings in English churches. (I feel a goosely tear in my eye.) Finally, the announcement:
This agreement is truly groundbreaking in three ways. First, it will give readers digital access to millions of in-copyright books; second, it will create a new market for authors and publishers to sell their works; and third, it will further the efforts of our library partners to preserve and maintain their collections while making books more accessible to students, readers and academic researchers. The agreement also resolves lawsuits that were brought against Google in 2005 by a group of authors and publishers, along with the Authors Guild and Association of American Publishers (AAP). While Google, the Authors Guild and the AAP have disagreed on copyright law, we have always agreed about the importance of creating new ways for users to find books and for authors and publishers to get paid for their works.
The story has ignited that part of the blogosphere not transfixed by the Microsoft demo of Windows 7. One of the more interesting analyses is Richard Koman’s write up for ZDNet. “Will Google Book Settlement Solve Orphan Works?” is here. An orphan is a title that no publisher can squeeze money from without pulling a Penguin. Those are titles recycled in homogeneous covers and offered up to students with a preface by an expert in medieval literature or a specialist in the early writings of James Joyce. For me, the most interesting comment was this statement:
According to Google, the deal with be great for everyone.
My take on this deal is that Google is deciding to make peace with publishers. Since the tie up with the abstracting colossus Cambridge Scientific Abstracts, Googlers are figuring out that publishers own communication channels that can grouse, complain, and make life generally miserable for the math club denizens. So, now there’s a revenue sharing deal.
I have several observations that are, of course, my own opinions:
- Publishers are now in the lair of the GOOG. The scent of money has brought them into the Googleplex. Once inside, it will be like the Hotel California.
- Google has made a tactical move. My thought process generates one question, “What’s next?”
- Google is ever so close to becoming a publisher. When will the company reveal its content assembly invention by Andrew Hogue and others. Google can slice and dice content, whip up a report, and sell it with a marketing mechanism that puts network TV in the 1950s to share.
I am thrilled for the publishers. I am happy for libraries. I guess I am excited about people curious about wood carvings in British churches. Only art and architecture students seem to visit the churches in Malmesbury, where I stay each year, but that’s a small sample. But most of all, I am thrilled for myself because the GOOG is going with the flow. I think once the euphoria dies down, it will be Nelly, bar the door. Google’s going to generate new information constructs and share the millions with the publishers eating in the Google cafeteria.
Stephen Arnold, October 29, 2008
ZipLocal: Another Search Engine in Red Ink
October 29, 2008
ZipLocal, according to the Canadian Press here, continues to lose money. ZipLocal is a local search engine. The company was founded in 2006 and focuses on Canadian cities. The content is available in English and French. The company was formed as a result of the merger of redCity Search Company and Zip411.net. The company says:
ZipLocal provides relevant search results from over 1.3million businesses with maps and capability for users to review, rate and tag business listings. ZipLocal is focused on creating the most comprehensive and engaging search experience at the neighborhood and city-wide level… ZipLocal is the only “made in Canada” local search site to successfully bridge a traditional business directory with the consumer-generated input required to be the next go-to search destination.
For me, the most interesting comment in the Canadian Press article was:
The full-year loss was $6.3-million, nine cents a share, compared with a prior-year loss of $6.3-million, 14 cents per share. Revenue was $4-million, down from $5.7-million.
Consistent losses and declining revenues are disappointments for investors. Beyond Search will root for ZipLocal. Let’s hope the company gets back on track, avoiding the fate of Entopia, Delphes, and the other companies I’ve suggested are struggling to survive in the search, content processing, and text mining market. Competing with Google Local is tough. Google’s free service allows a business to post information about the business and a coupon for free. Ah, the GOOG, and it’s not a directory publisher, right?
Stephen Arnold, October 30, 2008
Google and Viacom: Legal Fancy Dancing
October 29, 2008
John Letzing’s “Google Turns Tables on Viacom’s Copyright Cop” is a must read. The story appeared in MarketWatch on October 27, 2008. You can find the full text here. The hook for the story is that Viacom’s copyright analysis service, a firm called Bay TSP, has itself become a issue in the legal matter. Mr. Letzing navigates the legal thickets gracefully. I have simplified the Google thrust as pinning Bay TSP like an insect on a pin. For me the most interesting comment in Mr. Letzing’s write up was:
In its filing, Google complains that BayTSP “remained silent” about the infringement of Viacom’s content on YouTube for a months-long period in late 2006 — then deluged it with more than 100,000 requests to take down infringing material in a single day as a prelude to Viacom’s lawsuit. Google says that it has unsuccessfully negotiated on its own behalf with BayTSP during the past year for the release of its internal documents. “The need for court intervention has become obvious,” Google says in a court filing
Remaining silent is a fancy way of suggesting that Bay TSP did not disclose information when requested through normal legal procedures. When Bay TSP did not cooperate, Google took legal action.
In the big legal matter with Viacom, Google’s position is that it is not in the business of figuring out what videos may or may not violate copyright as users upload videos at the rate of one million a month, which may be a bogus figure. When a potential copyright violation is brought to Google’s attention, Google removes the video. Google’s position as I understand it is that the GOOGÂ complies with applicable copyright regulations. Viacom says Google does not and wants $1.0 billion from Google.
I am finishing a monograph about Google as a publisher. On one hand, I understand the respective viewpoints of Google and Viacom. On the other hand, I think there are a number of examples of Google’s activities in publishing. I am not an attorney, not employed by Google, and not working on this matter for Viacom. I am sitting in Harrod’s Creek, Kentucky, thinking about Mr. Letzing’s article.
My conclusion: the GOOG is a clever beastie. But this is a skirmish. The decisive battle is yet to be fought.
Stephen Arnold, October 29, 2008
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