20 (Rare) Questions for Google Search Guru Udi Manber Since there has been such a thing as Web search, Udi Manber has been working on Web search. Previously a computer science professor at the University of Arizona, then a senior vice president at Amazon and Yahoo's chief scientist, Manber is now vice president in charge of search quality for Google, where he makes sure results are engineered to the utmost (near) perfection. In one of the only public interviews he's ever sat down for, Manber gives PM a glimpse into how Google's dominant engine helps you find what you want, how you can help it find you and how search is constantly evolving with the pace of technology. —Glenn Derene How have you seen search evolve in the time that you’ve been working in the field? Google is typically tight-lipped about it the inner workings of its search business, but there are a few nuggets worth looking at in a Popular Mechanics interview with Udi Manber, the Google vice president who oversees search quality. Among them: Google rejiggered its search algorithm 450 times last year. Ed: Search or SEM?
It’s been tremendous. I like to say that it’s almost science fiction every five years. When the first search engine appeared in ‘94, compared with when I came out of academia in ‘99, compared with the way it was in 2003, compared with the way it is today—every five years there have been just incredible advances. What we do now, we couldn’t have foreseen 10 years ago. Today we’re finding a lot more information, and the questions are getting a lot harder. People expect more from us...Google tweaked search 450 times in 2007
Apr 19, 2008
NEWS: 20 (Rare) Questions for Google Search Guru Udi Manber
STATS: Value of Blog versus Social Network
Is about $14.8bn according to the publicly available information about the most recent financings of the two companies ($15bn for Facebook and $200mm for Automattic). But consider this comscore chart of unique visitors over the past year. It's a very similar growth trajectory, driven largely by the same phenomenon - the creation of personal spaces on the web by people who want to engage with others. So why is Facebook worth $15bn and Wordpress is worth $200mm? Well for one, Facebook controls the advertising inventory on the pages it serves and Wordpress does not. And for another, Facebook has built a "soup to nuts" social network with powerful viral channels (which they are cutting back on) and Wordpress has not. But trust me on this one. The blogging revolution is the adult social network whereas Facebook style social networking is for teens and college kids. This gap will narrow. Jason Goldman at Twitter used to be the Blogger product manager at Google. So when he saw the comscore chart on my wordpress vs facebook post yesterday, he asked what comscore's numbers are for Blogger. Here they are. As usual Google is the king dog. 190mm unique people saw a blogger served page last month. That's >20% of every Internet user in the world. Wow. Ed: Thus, Blogger is worth $600 million to Google - not even on the radar screen.The Difference Between Wordpress and Facebook
As Usual Google Is The King Dog [A VC]
Apr 18, 2008
NEWS: Secret Merger Talks Between Technorati And b5media Blow Up
Secret Merger Talks Between Technorati And b5media Blow Up
Erick Schonfeld
Blog search engine Technorati was days away from merging with blog network b5media when the whole deal blew up earlier this week, according to a source familiar with the negotiations.
Technorati has been searching for a new strategy ever since it appointed CEO Richard Jalichandra last October. It was recently trying to raise an additional round of financing, and pitching venture capitalists that it could turn itself into a blog advertising network and/or even pursue a blog roll-up strategy.
The talks with Toronto-based b5media (they’re big in Canada) indicate that it is taking the blog roll-up idea more seriously than we previously thought. If the merger with b5media had gone through, Technorati would have gained a network of 340 blogs. One of the slides in the pitch deck Technorati was showing potential investors (shown above) outlines how a roll-up strategy could be combined with an ad network. Technorati would use its search engine to promote owned-and-operated blogs. It would sell ads using its own sales force instead of third-party ad networks for an “immediate 30-50% revenue bump” and sell across its network...
NEWS: Resurrected Google: How's That Valuation? (35X FCF)
Ed: I estimate that some $200 million of the $937 million FCF has been earned by holding the average $50 that millions of the Long Tail blog earns, but never receives. Google has a $100 limit before issuing the first check. Even though they pay if you close your AS account, like most gift cards, people forget.
Resurrected Google: How's That Valuation? (35X FCF)
from Silicon Alley Insider by Henry Blodget
After Google's $75 post-earnings pop, it's time we checked on valuation again.
We value Google (GOOG) using free cash flow (see below). The bad news in the quarter was that Google's capital expenditures soared to $842 million, which depressed free cash flow (only $937 million in quarter, down from more than $1 billion the past two quarters). But we're optimistically going to assume that this massive increase in CAPEX won't continue forever and that Google will generated about $4.5 billion of free cash flow this year.
How's Google trading relative to that? At $530, it's trading at 35X FCF. That's a bit higher than we think it should be given then rapid deceleration of Google's US and UK businesses, but its certainly not insane. Unless free cash flow gets hammered, we continue to think the stock has a valuation floor around 25X (the long-term power of the franchise is just too compelling for investors to completely throw in the towel).
Free Cash Flow vs. EBITDA and P/E
Why do we look at free cash flow instead of EBITDA or Earnings? We find Google's non-GAAP P/E less meaningful than it would otherwise be because of the significant percentage of option cost that the company is still expensing (which most analysts ignore).
EBITDA, meanwhile, is a meaningless metric for companies that have significant capital expenditures, which Google now does. (Wait, do we mean EBITDA is a meaningless metric for the entire media and cable industry, which clings to it like a crutch? Yes, we do! We suspect "EBITDA" was invented by brilliant early cable industry titans who hoodwinked analysts into thinking that cash-flow-before-required-expenses was meaningful. It isn't.)
Will Google's FCF Get Crushed?
If Google's revenue flattens (or, God forbid, drops), will FCF get slammed? It might, especially for a couple of quarters. We believe, however, that Google's huge capital spending in recent years has been the direct result of having operating cash flow coming out its ears. If operating cash flow shrank, therefore, we believe Google would be able to significantly cut back on CAPEX, thus preserving cash flow.
Going forward, moreover, as Google continues to grow (perhaps on the other side of a recession), we think there's room for CAPEX to decline as a percentage of revenue. This would allow FCF to grow far faster than revenue.
Bottom line, we don't think Google's free cash flow margin is a "peak margin." We believe the company has been spending like a drunken sailor. If times get tough, we think the company would be able to cut back, thus boosting its FCF yield.
NEWS: Scott Adams Hands Dilbert Pen to Fans
By BRAD STONE, New York Times
For almost two decades, fans have written to Dilbert creator Scott Adams with ideas for strips, gags and punch lines.Now they can bring their notions right to the panels of Dilbert itself.
In a good illustration of how media is becoming ever more conversational and interactive, United Media, Dilbert’s syndicate, is revampingDilbert.com, letting the fans take up the cartoonist’s pen and tinker with, and then widely distribute, each strip...
Ed: legacy cartoonist adapts to web 2.0. Cool!
NEWS: Yahoo Tweaks Its (Advertising) Algorithm
Erick Schonfeld
Did Yahoo just raise its prices for search ads? Yesterday, Yahoo made a significant change to its advertising bidding system by removing the minimum bid for sponsored search keywords. The minimum bid used to be $0.10 per keyword. Now, the minimum bid will be set more dynamically based on two factors: the quality of the advertiser and the value of the keyword.
In theory, advertisers whose ads are clicked on more often will be rewarded with lower minimum bid requirements. But the past popularity of a keyword also goes into the equation, so a keyword that has been bid up in the past could also result in a higher minimum bid. So minimum bids have now become dynamic, and no single advertiser really knows what they are until they put in their bid for a specific keyword.
Already some search advertisers are complaining that their minimum bids have gone up 2X to 4X overnight. At this point, that is just anecdotal evidence. We will have to wait until the end of this quarter to see if the change has had any material impact on Yahoo’s revenues.
What is curious about this move is that it suggests that many keywords on Yahoo get bought at the minimum price, without any real competitive bidding going on. After all, if at least two advertisers are bidding for a keyword that means the minimum bid is no longer an issue. So it makes you wonder how effective Yahoo ad auction system is as a market. For a market to exist, there needs to be at least two bidders.
Conversely, the advertisers with the highest click through rates will now be in a position to buy up keywords below the point where lesser advertisers even hit their minimum bid. And that is not really a market either. For instance, if TechCrunch is awarded a minimum bid of $0.06 for the term “startup” and a Silicon Valley law firm needs to pay $0.15 for the same term (I am just making these up), TechCrunch could buy up the term all day at $0.06 if the law firm does not bid its $0.15. In that scenario, there would be even less competition than if everyone had the same minimum bid. But maybe Yahoo does not care so much about creating a market as it does about improving the quality of the ads on Yahoo search.
Any Yahoo advertisers out there seeing their prices go up? Any seeing their prices go down? Is this a good move for Yahoo ora bad one? Please share in comments.
Ed: Good conversation thread. Share your comments at Techcrunch.
STATS: What's a Blogger?
Bloggers are younger and higher percentages are Hispanic & African American than the general population. A higher percentage of Democrats than of Republicans are blogging. Now that Blogging might better be called a market segment rather than a market niche, it's useful with regard to positioning the marketing message to understand what a Blogger looks like, as distinguished from the rest of the population. According to the BIGresearch Simultaneous Media Survey, 26% of all adults say they regularly or occasionally blog. Of those: Bloggers tend to be younger, averaging 37.6 years old, compared to 44.8 for adults 18+ (the "general population"). Ethnically: In addition, Bloggers report a lower income ($55,819 vs. $56,811) and are better educated (14.3 years of education vs. 14.2). Political blogs are becoming increasingly common, especially in this election year, where 24.6% of registered voters say they regularly or occasionally blog. Political affiliation of regular/occasional Bloggers look like this in 2008: Analysis of Bloggers shows that they are using most forms of new media significantly more than the average market. Regular/Occasional New Media Usage (Top 5) % of Regular/Occasional Bloggers % of Adults 18+ Cell Phone 93.0% 87.5% Instant Messaging 75.3% 49.3% Download/Access Video/TV Content 72.2% 45.0% Video Gaming 66.9% 47.5% Text Messaging 65.5% 45.2% Source: BIGresearch, January 2008, N=15,727 Although Bloggers are more likely to use new media, the analysis finds that more conventional forms of media trigger their Internet searches. Magazines, at 51.6%, rank highest, followed by: Gary Drenik, President of BIGresearch, concludes ?"Bloggers are a diverse group and not who you would expect…" For more information, please visit BIGresearch here. Ed: Reality Learningfrom Research Brief by Jack Loechner
27 Thoughts On Blogging For The Artist
Guest Post: Robert Bruce is one of the most widely read, linked and reviled poets working on the web today. Grab yourself a free poem every Monday morning, subscribe to Knife Gun Pen. 1. There’s never been a better time to be a working artist. Ever. 2. There’s never been a worse time to be a working artist (if you’re not truly dedicated to your craft). 3. Social Media will not help you if you’re sending folks to sniff out a pile of crap. 4. If you’re thinking about SEO while writing your digital novel, you’re already screwed. Quit now. 5. The tech tools do not make the artist. 6. If you’re spending more time on Twitter than on your novel/painting/film/poem/play/sculpture, you’re dead. 7. The creation of great art has nothing to do with Community. 8. You will never have as many readers/listeners/viewers as TechCrunch. Get over it. 9. If you’re the real thing, you’ll be around in 30 years, still working. Most of these services and sites you now admire will not. 10. Your Technorati rank is not as important as you think it is. 11. Do not try to please an “audience”. They will ultimately hate you for it. 12. Income isn’t proof of anything. Ask Van Gogh. 13. Aim for Greatness, not the front page of Digg. 14. If you have a fall back plan, you will, inevitably, fall back onto it. 15. Though tempting, you’ll never crush your own mediocrity working only four hours a week. 16. If success finds you, please resist the urge to open a restaurant or start a line of clothing. 17. You do not need the middleman anymore. Quit begging. 18. If you wouldn’t do it without an audience, don’t do it all. 19. Ultimately, nobody really cares about your work. It may seem “negative” but trust me, this knowledge will serve you well. 20. Artists don’t outsource. Unless you’re Andy Warhol. 21. Make the technology work for you. Not the other way around. 22. Remember that the mainstream culture has yet to catch on to the power of the individual artist online. Keep working. 23. Consider getting a second job instead of slapping another Adsense unit next to the .jpg of your latest painting. Contrary to popular belief, work won’t kill you. 24. You no longer need to live in New York or Los Angeles. See: Hugh. 25. Do not work for the good opinion of anyone. Work for joy, wonder and the Lord God Almighty. 26. You do not need a signed letter from The American Academy of Arts and Letters to begin. 27. Blogging is easy. Art is not.from ProBlogger Blog Tips by Darren Rowse
Google's Search and International Growth Hides Declining US Clicks
Google paid click growth slowing - Advertising Shelf SpaceView NEWS: Cookie Deletion Inflates User Metrics
View NEWS: New Study Shows that Heavy Clickers Distort Display Advertising Click-Through
View ANALYSIS: Internet Consolidation or Fragmentation?
ANALYSIS: Who Earns the Page View?
Google Sites Revenues - Google-owned sites generated revenues of $3.40 billion, or 66% of total revenues, in the first quarter of 2008. This represents a 49% increase over first quarter 2007 revenues of $2.28 billion and a 9% increase over fourth quarter 2007 revenues of $3.12 billion.
Google Network Revenues - Google’s partner sites generated revenues, through AdSense programs, of $1.69 billion, or 33% of total revenues, in the first quarter of 2008. This represents a 25% increase over network revenues of $1.35 billion generated in the first quarter of 2007 and a 3% increase over fourth quarter 2007 revenues of $1.64 billion.
International Revenues - Revenues from outside of the United States totaled $2.65 billion, representing 51% of total revenues in the first quarter of 2008, compared to 47% in the first quarter of 2007 and 48% in the fourth quarter of 2007.
Paid Clicks – Aggregate paid clicks, which include clicks related to ads served on Google sites and the sites of our AdSense partners, increased approximately 20% over the first quarter of 2007 and approximately 4% over the fourth quarter of 2007.
Google Profit Rose 30%, Quelling Investor Fears
BY KEVIN J. DELANEYGoogle Inc.'s go-go era apparently isn't over.
The Internet giant topped Wall Street estimates for first-quarter revenue and profit, and it said that the weak economy hadn't hurt its business, as some investors had feared. Google's solid performance came despite slowing growth in the number of times consumers clicked on ads that appear alongside Google's Web-search results and on partner sites.
Google's shares surged more than 17% in after-hours trading after it reported first-quarter profit rose 30% from the year before, compared with 17% profit growth in the 2007 fourth quarter. Revenue rose 42% from a year earlier. Before the ...
Google reported earnings for the first quarter.
Apr 17, 2008
NEWS: NYTCo Q1 Revs Slide 4.9 Percent; Earnings Drop; Online Up 11.6 Percent
NYT Q1: Slide Continues, Digital Not Helping
New York Times (NYT) shares have been increasing based on the saber rattling by Harbinger et al, but they may stop today: The company's Q1 shows just show how troubled the company is. EPS, excluding one-time results, came in at 4 cents, below the street consensus of 14 cents. Ad revenue contined to drop, and classifieds fared particularly badly, down 22.6%. Release.
- Total revenues dropped 5% to $747.9 million from $786.0 million, narrowly missing the Street's $752.4 million estimate.
- Operating profit dropped 89% y/y to $6.2 million from $54.5 million during Q1 2007.
- The company posted a $335 million net loss, or break-even-per share, down from a $23.9 million, or 17 cents per share profit a year ago.
- Excluding special items, NYT reported 4 cents EPS, missing the Street's 14 cents per share consensus.
- Digital/Internet revenues up 11.6% y/y to $82.9 million from $74.3 million during Q1 2007. Internet ad sales up 16% y/y. Digital now 11.1% of overall sales, up from 9.5% a year ago. That's continued deceleration: Growth was 18% in Q4.
- About Group sales up 25% to $28.2 million on higher cost-per-click ads and acquisitions, that's down from 35% growth in Q4.
A difficult quarter from NYTCo.. the newspaper publisher has announced Q1 revenue of $747.9, down 4.9 percent from $786.0 million in the year-ago period, and below the $752 million that analysts had been expecting. On a comparable basis, excluding various charges, the company earned $.04 per share, down significantly from $.17 per share in the year-ago period. The quarterly number includes an $.07 per share ($10.4 million after tax) write-down after the company reduce the scope of a major advertising and circulation project. The line from CEO Janet Robinson could describe any newspaper company right now: "Advertising revenues decreased in the quarter as weaker economic conditions compounded the effects of secular change in our business." Some highlights:
-- Revenue at the core news media business slipped 5.7 percent to $719.7 million, as advertising fell 10.6 percent. This was partly offset by revenue gains from leasing out five floors at the company's new headquarters, but negatively affected by the loss of TimesSelect revenue.
-- About Group revenue increased 25 percent to $28.2 million from $22.5 million, attributed to higher CPC advertising, as well as certain acquisitions.
-- Total internet revenue, which includes About.com, as well as the internet revenue at the core business, total $82.9 million, for an increase of 11.6 percent year-over year. Digital now accounts for 11 percent of revenue.
-- Buyout costs totaled $11.2 million in the first quarter of 2008 compared with $7.8 million the previous year; flagship NYT is in the midst of a major buyout offer so that amount is likely to grow.
-- The company continues to emphasize its cost-cutting efforts, note a decline in operating costs for the fifth consecutive quarter. Robinson said they're still on track for 2008 savings of approximately $130 million.
-- For the coming month, the company says it will see a slowdown in the rate of ad sales decline back to single digits, but this is mainly due to calendar issues and the production of an issue of KEY Magazine.
-- Separately, the company announced its March numbers: Total revenue was down 6.4 percent to $235.3 million. on an 11.1 percent dip in ad revenue. About revenues were up 22 percent to $8.2 million, while internet ad revenue was up 14.8 percent. Release.
AP adjusts to changing industry and adopts new copyright tool
On Wednesday, Tom Curley, president and CEO of Associated Press, spoke at the annual conference of the American Society of Newspaper Editors (ASNE) and the Newspaper Association of America (NAA) and stated that "the news cooperative hasn't changed its fundamental mission, but must have a more flexible business model to meet the changing dynamic of the media industry."
In order to help struggling newspapers, AP has already offered price cuts for fees paid by members,expanding video and business coverage, and creating a digital archive database that members can search.
The AP also plans to re-price and re-package its news for its 1,500 daily U.S. newspapers, which would entail a core service for all national, state, and international breaking news with separate add-ons of premium service, instead of offering news feeds defined largely by the volume of news delivered.
Sorry, New York Times and WaPo Staffers, Here's Your Future...
A newspaper in Madison, Wisconsin, just took the step that many newspapers will be forced to take over the next decade, many sooner rather than later: It shut down its print business, fired a third of its staff, and restructured its business to focus exclusively online. We think similar fates will eventually befall most properties owned by the New York Times (NYT), Washington Post (WPO), Gannett, (GCI), et al.
On Saturday, The Capital Times, the city's fabled 90-year-old daily newspaper founded in response to the jingoist fervor of World War I, stopped printing to devote itself to publishing its daily report on the Web...
A newspaper in Madison, Wisconsin, just took the step that many newspapers will be forced to take over the next decade, many sooner rather than later: It shut down its print business, fired a third of its staff, and restructured its business to focus exclusively online. We think similar fates will eventually befall most properties owned by the New York Times (NYT), Washington Post (WPO), Gannett, (GCI), et al.
On Saturday, The Capital Times, the city's fabled 90-year-old daily newspaper founded in response to the jingoist fervor of World War I, stopped printing to devote itself to publishing its daily report on the Web...
Thomson and Reuters complete merger
Canada's Thomson Corp. and Britain's Reuters officially completed their integration today, creatingThomson Reuters Corp., now the world's biggest provider of financial data to trading floors according to AFP, which launched on the London stock market today.
Reuters' former chief executive Tom Glocer is heading the new company, headquartered in New York with around 50,000 staff in 93 countries across the world.
NEWS: Apple Mac Sales Soar, Dell Growing Faster Than HP
Apple Mac Sales Soar, Dell Growing Faster Than HP
Some encouraging news for Apple (AAPL) ahead of its March quarter earnings next week: Mac sales continue to grow much faster than the overall PC market, according to stats from research firms Gartner and IDC.
According to Gartner's estimates, Apple shipped 1.01 million Macs in the U.S. during Q1, up 32.5% y/y, while the overall U.S. PC market grew 3% y/y. Gartner pegs Apple's U.S. market share at 6.6%, up from 5.2% a year ago.
IDC estimates lower growth for Apple: It said the company shipped 950,000 Macs during Q1 in the U.S., up 25.1% y/y, while the broader U.S. PC market grew just 3.5% y/y. IDC estimates Apple's Q1 share at 6.0%, up from 4.9% a year ago.
Without worldwide estimates, we can't compare these estimates to what analysts will be looking for from Apple when it reports Q2 earnings next Wednesday. But the strong growth is good news, as Apple increasingly relies on Mac sales to drive growth in the next several quarters while iPod growth slows.
HP (HPQ) retained its no. 1 spot in both firms' worldwide estimates, but grew shipments slower than rival Dell (DELL). Gartner, for example, said HP shipped 12.99 million PCs last quarter worldwide, up 17.5% year-over-year. Meanwhile, it says Dell shipped 10.58 million PCs worldwide during Q1, up 21.8% year-over-year.
Gartner said the worldwide PC market grew 12.3% y/y during Q1, led by... everywhere but the U.S. Both firms blamed weak U.S growth on the soft economy.
See Also:
Apple's Growth Story Intact: Mac Sales Up Huge In February
Apple's Mac Business 'Recession Proof' -- (Crazy) Analyst
Apple's 1Q 2008 U.S. Market Share Up from 2007
Wednesday April 16, 2008 07:18 PM EST
Written by WildCowboy
Gartner has published a preliminary report on U.S. and worldwide PC shipments for the first quarter of 2008. According to Gartner's numbers, Apple placed fourth in U.S. marketshare at 6.6%, up from 5.2% in the first quarter of 2007. Apple's U.S. shipments increased 32.5% year-over-year, far outpacing the total industry shipment growth of 3.0%
Apple did not place in the top 5 vendors for worldwide PC shipments, where Toshiba held the fifth spot with a 4.3% market share. Worldwide, overall PC shipments grew by 12.3% year-over-year.
Previous Gartner reports had placed Apple with a 6.1 % U.S. market share for the fourth quarter of 2007, and 8.1% U.S. market share for the third quarter of 2007. Apple's numbers for the back-to-school third quarter traditionally benefit from its strong educational presence.
NEWS: AI Heuristic for The Alive Web
Ed: MIT alumni. Artificial intelligence heuristics for tracking, inference, application. Cool. Go MIT.
A lot of clicks to track down this conversation thread. Too many distractions from the main thread.
The Alive Web
I find this concept very interesting, and important as we move from our current navigation/UI to new forms. New Scientist'scoverage:
SITES that evolve as if they were living organisms are making their way onto the internet.
This ability to adapt without human intervention allows sites to stay up to date with changes in their users' tastes and can result in designs that are more user-friendly than anything a human designer is likely to come up with. Evolving sites might also allow web designers to home in on the features that work best for users.
- Posted by John Battelle
Living web sites that grow, develop and evolve to suit the taste of the people that read them are now finding their way on to the internet...
For two decades, computer scientists have played around with evolutionary software that can gradually evolve and mutate to carry out a task efficiently, or hone the design of a wing, robot or whatever, without the need for a programmer to get involved.
A grouping of some of the sites with human controlled design properties or genetic design evolution Now these techniques are being used to allow web sites to keep themselves up to date and to adapt to the latest fads and fashion, reports New Scientist.
Not only are they quicker to evolve than possible with human intervention, they offer the chance to come up with new ways to organise material in the web that work best for users.
Matthew Hockenberry and Ernesto Arroyo of Creative Synthesis, a non-profit organisation in Cambridge, Massachusetts, have created evolutionary software that alters colours, fonts and hyperlinks of pages in response to what seems to grab the attention of the people who click on the site. Seewww.creativesynthesis.net for more.
The experiment measures a number of usability goals and attention metrics (such as mousetracking). Users were given the opportunity to utilize an analytic tool for mouse tracking. AI processes are used to offer possible interpretation of the results, such as identifying mouse tracks indicative of reading. A discussion interface created conversations focused on pattern identification of user behavior and comparisons between domain content. Users also noted the impact of customizations to the design outside the pre-seeded experimental options (such as color changes, etc.). Followup versions of the pilot included low level support for random variable mutation (organic canvas) similar to the outline described previously.
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