MappingTheWeb //

Every hot Internet space goes through an evolution. There is an initial acceptance stage, followed by hyper-growth. Recent spaces that fit this description include micro-blogging, online video, and social bookmarking.

Buzz and exposure in these areas exceeds that of most other areas. Furthermore, acquisitions have taken center stage. Google, Yahoo, and Microsoft are the usual suspects, but traditional media companies (Fox, Viacom, etc…) are beginning to recognize that the web is going to play a vital role in the progression of media.

High valuations are also an indicator of a hot sector. They may reflect actual value, factoring in future growth and earnings, but often these stratospheric numbers are pulled out of the air by Kool-Aid drinking analysts.

So… back to the title of the post… what is the next hot space?

We’ve been hearing a lot about ’semantics’ and the ’semantic web’, but when is there truly going to be an app or service that regular people can use that leverages this technology? It’s been talked about for years now, but we have yet to see much progress (at least in my mind). New search engines Powerset and Hakia promise to revolutionize search using semantics - I guess time will tell.

Platforms and aggregators seem likely poised for success. They bank off raw data and information to create interesting, value-added services. The Facebook platform is a great example of this. Now, MySpace and Bebo have introduced similar platforms.

Perhaps, simple apps or feature-specific apps (think 37signals) will be the future. Keeping it simple and not over-crowding the offering with useless features is more complicated than it seems. Though this cannot be classified as a given space, it is more of a strategy that can be applied to any space.

To me, it seems that the most successful apps will either be more complicated or more simple than current services. This may seem like a generic statement that covers all bases, but I’ve been amazed (and unimpressed) with the majority of recent offerings.

What do you think the next hot space will be?

Today, Yahoo added new search features and functionality. Video embedding (via Yahoo Video, YouTube, and MetaCafe), Flickr integration, event information (via Upcoming.org), and new Yahoo Shortcuts were all introduced. We’re seeing all this wonderful social media integration - so what’s the big problem? It’s biased. And search engines shouldn’t be biased.

To be honest, I’m genuinely upset about the changes. Not only do they add more clutter to the page, but they’re decreasing the overall quality and relevancy of the search engine. Furthermore, Yahoo is getting praise for these changes. Many are even saying that the company is catching up to Google. I even heard a whisper of the term “Google killer”. This is a bold statement and it can’t be farther from the truth. In reality, Yahoo is widening the gap. They are drifting further away from Google, as they are providing less relevant, more biased results. They are redefining ‘vertical creep’. On the occasion, Yahoo will have the most relevant result on the entire net, but more often than that, it won’t. What Yahoo needs to do is go back to the drawing board and work on their algorithm. This is the bread and butter of any search engine. Forget the web 2.0 app integration.

Pardon my rant, but I’m not a big fan of this move. It is company bias in a space where there should be no bias. All this new integration means that a given user will (in most cases) not be receiving the best quality, unedited, clean, no-strings-attached results. Rather, they are subjected to ’Yahoo’ results and links to Yahoo properties. In my opinion, this leads to higher short-term benefits (and revenues) for the company due to an increase in page views, but translates to long-term problems in the areas of relevancy and perception.

If Yahoo does want to include such results in search, place this information in the sidebar and provide disclosure around it. Numerous others have done it in the past, so why not Yahoo? By integrating company results into the natural search results, it confuses and/or deceives the user. This isn’t in the best interest of the company - at least in my mind. Another possible solution is richer functionality in the ‘vertical search tabs’. If I really want images or videos in my results, I search via Yahoo Image search or Yahoo Video search, not regular search. I think there is an opportunity here, but Yahoo is being greedy.

I say, “Just gimme the best damn results.” Google does a pretty darn good job of this. They haven’t cluttered the results or riddled the page with endless amounts of company-centric material.

One bright spot for Yahoo is Search Assist. This new tool (somewhat akin to Google Suggest) provides contextual suggestions and conceptual recommendations for your search queries. This saves time and hassle, and may indeed aide you in reaching the most relevant results. So why do I like this? As opposed to the other Yahoo features, this one is unbiased (at least I HOPE). It is based on user behaviour, patterns, and trends.

Below is a screenshot of Yahoo Assist (courtesy of Search Engine Journal):

In the end, I think what Yahoo is trying to do is capitalize on all their recent web 2.0 acquisitions by integrating them into search. I think it’s a valiant idea, but involved poor execution. As I mentioned before, I don’t think that integrating such results into the natural search results is the optimal strategy. Company bias and and self-fulfilling intentions start to play a role, and all of a sudden, people are starting to question the credibility and trustworthiness of search. Losing trust is probably the worst possible outcome for Yahoo at this point in the game.

Is it just me or is web 2.0 suffering from a stagnant lapse? Don’t get me wrong - I love the concept of web 2.0 and social media. That definitely isn’t the problem. The lack of innovation and inferior business models are what bother me most. Add to that the fact that ideas are being ripped off and clones are abundant. Honestly, do we need another social bookmarking site or a generic video portal?

This lack of creativity and thought around business models is quite discouraging. A business plan full of buzz words and a flashy PowerPoint just don’t cut it anymore. What users really want is value; they want a service they can use. This seems obvious, but I can’t believe how many ridiculous ideas continue to be funded.

What about revenue models? We all know that a majority of start-ups are dependent upon Google ads as their key income generator. Truly, this is not a sustainable model. Unless a given property is able to generate millions of page views a month, then such a model is impractical. Creating a paid service isn’t difficult. Creating a truly compelling service and convincing the customer that it’s worth the price is the hard part. If there is a stunning value proposition for the end user, they will pay. One thing to keep in mind is the general trend that (almost) all Internet services eventually progress to free.

Having said all that, I am optimistic that the tables will turn. Despite all the clutter in the web 2.0 space, we have witnessed the growth of some remarkable start-ups over the past year, most notably Twitter. I refuse to use the term ‘bubble’ in this context, but I do believe that changes are in the pipeline. Funding will become more scarce and investors will become more selective. Hopefully this will weed out the crap and pave the way for innovative new ideas. Let’s keep our fingers crossed.

Today, News Corp and NBC Universal announced the name of their much anticipated YouTube killer - Hulu. A couple of weeks ago, the unnamed venture raised $100 million via Providence Equity Partners in exchange for 10% of the company. A quick math calculation equates the valuation to a whopping $1 billion. While many scoffed at this ridiculous valuation, I’m not so quick to count out this potential industry player.

Why is YouTube as big as it is? Obviously their video widget provided a viral marketing channel, but that only funnels potential users to the site. It still doesn’t explain the ’stickiness’ and allure of the video-sharing portal. Nonetheless, it quickly becomes clear that illegal content is the driving force. YouTube is nothing with it. Millions of users hit the site everyday to watch music videos, TV shows, and movie clips. Not many care that Joe from Connecticut can juggle. The only exception I can think of are how-to videos. These non-commercial, useful UGC clips provide value to the viewer, regardless of whether you know the creator or not.

So how can Hulu compete against YouTube and the other big boys? Simple. Hulu has one thing that nearly all of other video sharing sites lack - the rights to production-quality content*. Sure, YouTube and others will continue to stream illegal content, but is this truly a sustainable long-term strategy? I’m not so convinced. What catapulted YouTube to the top in the first place may ultimately lead to its demise in the end. This is imminent flaw of social media. Just ask Digg.

So now anyone can watch legitimate, high-quality episodes of Heroes, madTV, 24, The Office, Family Guy, and Las Vegas (to name a few) for free, on-demand, anywhere in the world? Sounds pretty compelling to me. What does all this mean for traditional TV? Well, traditional folk can still view News Corp/NBC programming via the old tube, whereas tech-savvy users will turn to the Internet. Moreover, if you were to miss a given episode on TV or you happened stuck in Kenya without a TV, you can still tune in and watch on Hulu.

This brings up another huge advantage that Hulu has over the competition - a stunning revenue model. Hulu can command huge ad dollars and premium CPMs as they have complete control over the content. Furthermore, the site can leverage pre-existing relationships with advertisers at News Corp and NBC Universal. As opposed to traditional TV where viewers can’t click or ‘follow’ the ads, this form of programming is interactive and opens the door to new advertising opportunities. This conversion process is not only more effective, but also measurable.

It’s still too early to speculate the potential features and functionality of the offering. For what it’s worth, the portal may only stream old episodes or segments of episodes. I highly doubt this, but we will soon find out. Hulu isn’t currently operational. The home page is simply a landing page where interested parties can enter their e-mail to get a sneak peek of the BETA product when the time comes (apparently sometime in October according to Hulu).

I look forward to catching of glimpse of this potential industry-changing venture. Many aren’t giving it a chance, but I wouldn’t be so quick to make a judgment just yet.

*Note: As far as I know, there will be no user-generated content (UGC) on the site. It will strictly consist of company-owned premium content. Please inform me if you know otherwise.

This evening, Digg launched an all new interface. The new design is even more clear and intuitive than before. Some of the changes include:

• The ability to view both news and videos on a single page. This is due to feedback received indicating a high interest in videos.
• Tweaks to the page and story summary layouts.
• Streamlined navigation.
• Increased customization options.
• Simple one-click bury with no explanation needed.

All in all, small cosmetics changes such as added icons, new colour palettes, and shuffled page elements add to the overall clean experience. The service description has moved from the right sidebar to the main navigation column. This provides more concise site messaging for new visitors, as well as a clear call-to-action for potential new users (i.e. Join now). As a side note, Digg continues to minimize page views by maximizing AJAX functionality.

From a more broad prespective, I think Digg is trying to bring the service mainstream. The dead simple navigation and clear messaging indicate a marketing push to regular folk. That being said, it also appears as though Digg is making a big push toward monetization. A very large, prominent inline rectangle ad is now visible on the home page. Article pages are also riddled with two ads - both a leaderboard and an inline rectangle ad. It will be interested to see how the Digg community reacts to such changes.

From an initial glance, I really like the new changes. Digg has done a really good job of simplifying the experience, yet adding functionality. Such a counterintuitive feat can only be the result of brilliance. Kudos to the Digg team.