“The Happiest Place on Earth”

The domain industry is fascinating.  I have enjoyed being involved in events that are both educational and productive for Click Forensics and me.  The latest event is the TRAFFIC conference held this week in “The Happiest Place on Earth”, Disneyworld of course!  Everyone seemed happy (even though there wasn’t a Starbucks anywhere to be found!).

The domain industry appears to me to be at a crossroads.  While the value of names continues to rise, the earnings from monetization programs are falling.  Domain owners and parking companies are struggling to gain more transparency from Google and Yahoo.  Today, there is essentially no transparency.  Traffic from domains is sent up to Google and some amount of money is paid for the traffic.  While agreements regarding revenue shares can be negotiated up front, without the ability to see inside the black box, the monetization metrics are a mystery.

One speaker at this conference has a deep understanding of this issue.  Michael Gilmour runs whizzbangsblog.com from his home in Australia.  I heard Michael’s presentation and had a chance to speak to him at an after party.

He spoke candidly about the risks that the industry faces from the search engines black box approach.  “The lack of transparency in the whole process means that they are accountable to no one.”Gilmour said.  He accurately pointed out that, “Google has been progressively reducing its network traffic margins from a high of 22.1% (Q1 ‘06) to low of 11.9% (Q1 '08).”

What this means is that parked domain companies and site owners are being squeezed.  This is a trend that will continue.  Advertisers are demanding higher quality traffic and Google has had a hard time delivering that from low quality traffic sites like MySpace.  Enter the parked domain channel.

Gilmour has written a series of blogs addressing this issue.  The eight part series can be found on his site at www.whizzbangsblog.com.  In it Gilmour says, “Google is able to launder a lot of bad traffic with good traffic and make it all pay the same while they themselves can discriminate on what they pay out.”

There is a lot of great quality traffic that comes from direct navigation domains.  This is an industry with lots of smart folks and great ideas to help advertisers sell more stuff.  It will take cooperation and transparency to build value in the domain space.  As Gilmour says, “Unless they (the parking companies) are able to audit Google then they can't ever be assured of their share of the revenue.”

Without cooperation, transparency and standards, future conferences may not be as happy as this one was.

Tom

The San Antonio Stonecutters

Love the Spurs or hate them, its hard to argue with four rings in nine years.  The Spurs represent all that is good in professional sports.  Teamwork, good citizenship and hard work.  They are a model team built on stability and consistency. 

Inside the organization people know the impact Popovich has had both on and off the bench.  It was Pop who had the Jacob Riis words translated and posted in the locker room, 

"When nothing seems to help, I go look at a stonecutter hammering away at his rock perhaps a hundred times without as much as a crack showing in it. Yet at the hundred and first blow it will split in two, and I know it was not that blow that did it, but all that had gone before."

Practice makes perfect and teamwork makes winners.  There are lessons to be learned in all aspects of life from these words.  So hammer away Spurs and thanks for being an inspiring group of winners.

Tom

 

Memorial Day 2008

I have a friend named Joe who passed away earlier this year at the age of 82.  Joe served in World War II.  Although I would often ask him about it, he would almost never discuss it.  Sherman had it right when he said “War is hell” and no one knows that more clearly than those who served our country by being in the middle of combat.

These days there is a great deal of discussion, debate and differing opinions around the current war.  While I respect all of those perspectives, none of them change the fact that we should pause to honor those who have served, and are serving our country.  Our country is what it is because of the brave men and women who have served.  

I hope you will take this opportunity to honor our heros.  A few years ago, I stood with my family in the middle of Arlington cemetery in Virginia.  It is an overwhelming experience.  The 360 degree view of tombstones is a visual reminder of the scale of the sacrifice.

Monday I will place a flag on my friend Joe’s grave.  My son and I will walk through the cemetery and talk about what it means to serve, honor and respect.  It is the least we can do.

Twitter Catches On

Twitter interests me.  No, I don’t know how they will make money, although I do have some ideas (think geo-location and advertising).  I only started “tweeting” in April.  As soon as I did a reporter from the Express-News connected with me.  Laura Lorek has covered Click Forensics for several years and I read her consistently.  She sent me a “tweet” asking for an interview about Twitter.  The result is a well written (and entertaining!) story.  Find it here.