Umair Haque / Bubblegeneration

Wednesday, November 16, 2005

This Post Is Not About G**gle

Google Base is live.

I think this is very interesting. It gives us the first hints of Google's coming strategy decay.

There's only one question that matters, strategically: is Base the AOL-style walled garden of the 00s?

That is, are returns to info owned by Google going to be lower than decentralized info?

I think, probably, yes. That depends on my assumptions; which are that communities and markets like Last.fm and TIOTI are the future of efficient attention allocation - and that Google can't play that game.

What that means is that Google keeps indexing the world's information, albeit at increasingly costly factor prices; while superior returns begin flowing to reconstructors and smart aggregators. This scenario devalues centralized mechanisms/walled gardens, like Base - because they're not part of the attention ecosystem; they're part of GoogleWorld (we really do need a name for all the info Google owns).

In the short run, it will certainly be a nice incremental revenue stream (even if it's new name is likely gonna be Google Pr0n).

But I think what it does do is begin to point to a growing vital point competitors can strike, if they'd stop being so inept - I mean, Shoposphere has its intent in the right place, but the model is economically and strategically backwards; I'd tell you why, but I've discussed how to help Yahoo more than enough for free (and I'm sure most of you can figure out the basic flaw in the model).

Then there's Amazon, eBay, VCs, and media - all attention economy players, who seem totally intent on missing the tectonic shifts right under their feet, which are eroding all their returns.

Another, marginally related point - it also points to the uncooling of Google. I mean, Base? Can you get more Orwellian, lame, sinister, connected to all the wrong stuff?

EG: Al Qaeda means "the Base".

The only name I can think of in recent memory that's more corporate is "XBox".

Man, I am so falling off the GYM bandwagon!!

-- umair // 7:18 AM // 6 comments

Comments:

"But I think what it does do is begin to point to a growing vital point competitors can strike, if they'd stop being so inept - I mean, Shoposphere has its intent in the right place, but the model is economically and strategically backwards; I'd tell you why, but I've discussed how to help Yahoo more than enough for free (and I'm sure most of you can figure out the basic flaw in the model)."

Enough hints already! What is the flaw with Revver, Shoposphere et al? Is it that they require unique content, rather than aggregating existing content? Is it that the value lies in sorting that content, rather than owning it? Why are Tioti and Last.fm better models than the Revver? Help me out here!

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PeteCashmore // 2:27 PM

BASE == "Big All-Seeing Eye"

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Adam // 6:17 PM

As for the future of the GYM meme, this story from the LA Times shows how the execs at Yahoo in Santa Monica are thinking: http://www.latimes.com/business/custom/cotown/la-fi-yahoo14nov14,0,7771544.story?coll=la-home-headlines

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Brian // 9:06 PM

i think there are still network effects to be reaped by this:

1. based on the data you enter google has a better idea of your interests. this allows it to provide you with better personalized search and better targetted ads.

2. it is also a place for you to store YOUR information. since they already have your emails, and they already have your adwords account, as well as your blog account, and your adsense account, and your web analytics, and your chat history, and your desktop search, this is even more personal information they have on you. if they can get all your information, the switching costs become too high to even consider services provided by competing networks, IMHO.

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kid mercury // 9:22 PM

Why would returns on info owned by Google be any lower than decentralized info? Any sort of incremental cost would likely be outweighed by the potential revenue benefits. Why would Google want to scan every book ever published? More content=more relevance=more revenue. I'm not sure how it points out a place where competitors can strike...it may call them into action off the sidelines but that only ultimately serves Google's purpose anyway if the competitors try to co-opt the idea (more content=more relevance=more revenue)

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Looch // 10:35 PM

Kid Mercury,

You're partially right, but to think about the whole thing strategically, you must factor in the other side of the equation: returns to decentralized info.

Pete,

Unfortunately, I really can't say. I give waaay too much away on Bubblegen and I have to stop doing so.

Note, I was talking specifically about Shoposphere - not other plays like Revver.

Looch,

You've assumed your own answer: that benefits to Google must outweigh decentralized benefits. So, we can't talk about much, especially not about vital points.

Also, Your equation "more content=more relevance=more revenue" is trivially wrong. Does more content on Yahoo equal more relevance?

I can't make any sense of the rest of your comment.

Brian,

Thx for the link.

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umair // 10:57 PM