Online privacy: what’s at stake

It is widely believed that a flourishing democracy requires an independent, diverse, and financially solvent press.  With print newspapers set to disappear in the next few years, the future of quality journalism is highly uncertain. This year, the online version of the New York Times will generate about $200M in […]

Facebook, Zynga, and buyer-supplier hold up

The brewing fight between Facebook and Zynga is what is known in economic strategy circles as “buyer-supplier hold up.” The classic framework for analyzing a firm’s strategic position is Michael Porter’s Five Forces. In Porter’s framework, Zynga’s strategic weakness is extreme supplier concentration – they get almost all their […]

Stickiness is bad for business

It is common to hear entrepreneurs and investors talk about the high level of engagement (what we used to call “stickiness”) of their website.  They quite rightly believe that it’s better to have a more engaging user experience, as that generally means happy users. Unfortunately, the dominant advertising […]

News is a lousy business for Google too

There is a widespread myth that search engines have taken profits away from news websites. A few months ago, Rupert Murdoch said: “Google has devised a brilliant business model that avoids paying for news gathering yet profits off the search ads sold around that content.” The reality is […]

A massive misallocation of online advertising dollars

In an earlier blog post, I talked about how sites that generate purchasing intent (mainly “content” sites) are being under-allocated advertising dollars versus sites that harvest purchasing intent (search engines, coupon sites, comparison shopping sites, etc).  As a result, most content sites are left haggling over CPM-based brand […]

What’s strategic for Google?

Google seems to be releasing or acquiring new products almost daily. It’s one thing for a couple of programmers to hack together a side project. It’s another thing for Google to put gobs of time and money behind it. The best way to predict how committed Google will […]