Archive for April, 2008
Filed under: Competitive strategy, Google (GOOG), Wal-Mart (WMT)
 Google, Inc. (NASDAQ: GOOG) has risen from the ranks of startup to one of the most powerful advertising forces on the planet in about a decade. Although it maintains a corporate mantra of “don’t be evil,” the company’s absolute power over the world of internet advertising borders on on the perception of monopoly just because it has the best product in all the right places. Notice I used the word “perception” there. Is Google a monopoly because it simply has the ideal product that customers apparently use and love? Of course not.
Similar to how Wal-Mart Stores, Inc. (NYSE: WMT) rose to power, Google got there by providing something the competitors didn’t: the best product presented in the ideal way that was the most useful for the consumer. Wal-Mart opened more stores and offered the lowest prices, and consumers noticed and made it the largest retailer in the world as a result. Google is the largest internet advertiser in the world using the same means in a way, but like Wal-Mart, it has competitors (albeit, with much smaller market shares).
But when a company controls so much of the ad market in the on the web space, smaller advertisers and businesses that want to break onto the scene and fight with larger competitors that may be slower and tuned out will have to use Google at some point. To grow, one simply cannot do business the way it was done in the past. Just like the small and scrappy manufacturer trying to get into Wal-Mart but can’t due to the larger companies offering the same widgets at much lower prices, this effect works inside Google too. Advertisers bid on keywords and if they have the ability to remain relevant to the consumer within Google’s search results, they can out-spend smaller advertisers day in and day out. Are these market forces some kind of monopolistic behavior? Google doesn’t control this — it is simply giving the most relevant information to the customer. Still, one can see the spot Google could be in very shortly, if it isn’t already there.
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Filed under: Earnings reports, Competitive strategy, Yahoo! (YHOO), Time Warner (TWX), Time Warner Cable (TWC)
 Investors don’t know what to make of Time Warner Inc.’s (NYSE: TWX) results.
First, shares rose this morning as investors gave a thumbs up to Chief Executive Jeff Bewkes’ plan to dispose of the media conglomerate’s cable TV business. Then, they fell after the earnings conference call. Perhaps investors were expecting news on a deal for AOL. Otherwise, the parent of CNN, Time magazine and Warner Brothers posted mediocre quarterly results (pdf).
“We’ve decided that a complete structural separation of Time Warner Cable Inc. (NYSE: TWC), under the right circumstances, is in the best interests of both companies’ shareholders, Bewkes stated in the earnings release. “We’re working hard on an agreement with Time Warner Cable, which we expect to finalize soon.”
Time Warner investors, who have seen the value of their stock fall by more than 25% over the past year, have long wanted the company to dispose of its cable business. Owning both content and distribution doesn’t seem to make much sense anymore. The question is what the New York-based company will do with the money from the sale.
Paul Greene, media analyst with T. Rowe Price, told Bloomberg News that the content business is cheap without the cable business and “if they get cash from cable and use that to buy back shares of the parent company, that’s very accretive.”
The other big question mark hanging over the stock is AOL. During the quarter, revenue fell 23% to $1.1 billion as subscription revenue slumped as a result of the company’s switch to an advertising-supported business model. Advertising revenue, though, rose only 1% amid a decline in display advertising. These results will heighten pressure on Bewkes to do something about the internet business — a deal with Yahoo! Inc. (NASDAQ: YHOO) would be nice — because it’s just not growing as fast as Wall Street would like.
But as Bloomberg notes, the performance at AOL will improve: “In the remainder of 2008, AOL’s ad sales will rise because of revenue from the Platform A network for buying and selling ads, Time Warner said in a regulatory filing today. Sales of so-called display ads shown on Web sites will fall in the current three months, partly because of `expected continued challenges of integrating recently acquired businesses.”
This may be a case of too tiny too late.
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Posted by: in Services
Filed under: Internet, Video, Web services, Google, web 2.0
YouTube, the mayor of New Orleans, and the governor of Louisiana have publicly invited the presidential candidates to participate in a presidential forum this September. Since this isn’t an official debate, it is unknown if any of the candidates will actually show up. Either way, the event should prove successful — here’s why.
It’s been quite some time since New Orleans was hit by Hurricane Katrina, but the city isn’t done suffering. There’s about 86,000 evacuees stuck in Houston, Atlanta and 40 other cities, and there the government currently has no plan on how it will bring these people home (not to mention the city’s other 921,332,437,208 problems). So even if the candidates don’t show up to the debate, the publicity stunt should help to remind government officials that it’s not over yet. In other words, it’s a giant call for help.
Despite that many may dismiss YouTube as a time-waster, this isn’t the site’s first dive into the presidential race. Last year, YouTube allowed its users to record and send in questions, which would be answered by the candidates on Television. And though we know the Google owned site gets a lot of great publicity out stuff like this, we can’t help but tip our hat for the good work.
[via Silicon Alley Insider]
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Posted by: in Services
Filed under: Audio, World wide web, Video, Web services, web 2.0
There are two things that make FLV.To absolutel amazing. The first is the sheer number of Google AdSense and referral ads that the developer managed to cram into a small space. But we’re willing to overlook that because the other remarkable thing about FLV.To is how simple the site makes it to save YouTube videos as MP3 files.
No, you’re not going crazy. YouTube deals in videos, and MP3 files are audio only. But there’s a large number of music videos on YouTube, and FLV.To will let you save the audio from those videos in a matter of seconds. Just pop in the URL of any YouTube video and the site will proces the file and spit out an MP3 which you can download and listen to. If you’ve already gone through the process of downloading YouTube videos as FLV files, you can also upload Flash videos from your desktop for simple conversion.
[via MakeUseOf]
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Posted by: in Rights Online
kylehase writes “The release of Wikiscanner last year brought much attention to white washing of controversial pages on the community generated encyclopedia. Apparently Wikipedia is very serious in fighting such behavior as they’ve temporarily blocked the US Department of Justice from editing pages for suspicious edits.”
Read more of this story at Slashdot.
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Posted by: in Rights Online
An anonymous reader writes “A good friend of mine had her younger brother apparently commit suicide last week. He was a young, promising CS major who was close to being accepted into a very prestigious school. He was very into Linux as well as PHP/MySQL coding. He left completely nothing behind for the family as far as a death note or explanation, and there is some possibility that this was all somehow a tragic accident. The family is in a situation where proof of accidental death would change how this was viewed in terms of paying for parts of the funeral. More importantly, some members of the family are hoping to find something, anything, that might explain why this all went down. Since I’m the most computer-skilled person the family knows, they have asked me if I could help them try to find some information. My possible approaches are: his Linux laptop, his university, Gmail And Hotmail email accounts, and a second MySpace profile that apparently has been tagged as private. How ethical would it be to, say, try to crack his root password in a situation like this? I wouldn’t attempt to crack a man’s account for his wife because she thinks he’s cheating on her, as his life is his own business. In death, would you have the same respect for a person’s private thoughts? Secondly, If I contacted places like Google, MSN, the university, and MySpace, what are the odds that they would give me access to any of his accounts? I’ve links to obituaries and such to prove that he is indeed gone. Would it be a matter of not giving it to me (maybe only to the family), or is this something that they wouldn’t do at all? Any thoughts on if I should do this and if so, how I should go about it?”
Read more of this story at Slashdot.
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Posted by: in Services
Filed under: Design, Web services
Logoease is a simple, web-based logo-creation tool that offers basic stock clip-art and fonts. You start by choosing a logo image from a general set of categories, and then you’re taken to the main editing screen where you can add text and arrange your logo.
You can add up to five lines of text of various fonts and colors, and you can change options like bold, italics, and font size. Your logo picture can be colored, and objects can be layered with “send to front” or “send to back” functions.
When your logo is finished, you can download a zip file containing a .jpg, .eps, .tiff, and .png of your logo. You’ll need to signup for a free account (surprise) to be able to download the logo. When we first tested the site, we got errors when attempting to save our logos; however, the site appears to work properly now.
[Via makeuseof]
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Filed under: Consumer experience, Competitive strategy, Marketing and advertising, Krispy Kreme Doughnuts (KKD), Battle of the Brands
 This post is part of our Battle of the Brands feature. Let us know which brand you like, and check out other Battle of the Brands posts.
Oh, how the sugary have fallen. Ten years ago, even five, you and I both know how this would have come out. In the standoff between longtime national fried-dough pusher Dunkin’ Donuts and upstart sweet freak Krispy Kreme Doughnuts (NYSE: KKD), Krispy reigned supreme. The chain was rolling out new franchises as fast as dough circles could parade around its restaurants on shiny metal racks, and each time it did local police stations did overtime directing traffic.
Somehow, the mighty fell after the considerable sugar high, largely connected to poorly-managed finances, badly-handled expansion, and a sudden national fear of carbohydrates. All the while, Dunkin’ Donut managers everywhere continued to plod along, making the doughnuts, and quietly stirring a blue-collar breakfast revolution. One day America woke up and realized, hey, Dunkin’ Donuts’ coffee is good! Someone named it “Better than Starbucks” and it soon became clear that the product guys had realized something: we make a lotta money off of coffee. Actually, more than half of the company’s revenue.
Soon Rachael Ray was perkily declaring her love for Dunkin’ Donuts (pointedly never eating a doughnut in a commercial), Dunkin’ Donuts coffee was available in grocery stores, and Krispy Kreme doughnuts were growing stale in their plastic cases. The company couldn’t even find a way to make a trans-fat-free doughnut, let alone win back the enthusiasm America had once felt for the iconic glazed dough circles.
While today it’s my belief that more Americans love Dunkin’ Donuts than Krispy Kreme, it’s interesting to note that it’s not because of any superiority in the powdered chocolate creme-filled pastry (oh, how I loved you once upon a time!). No, it’s all in the rest of Dunkin’ Donuts’ menu — and perhaps its working-class, no-fuss cred — and it’s unlikely Krispy Kreme will ever be so hot and fresh again.
Vote in our poll for Krispy Kreme or Dunkin’ Donuts as your preferred brand, and let us know in the comments why you love it.
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Filed under: Launches, Consumer experience, Competitive strategy, Starbucks (SBUX)
Starbucks (NASDAQ: SBUX) plans to come out with new premium drinks this summer. One will be a fruit smoothie and another a sugar-based drink created by a company in Italy. According to The Wall Street Journal, “Starbucks states they’re the first stage of a broader push into healthier drink and food offerings.”
The new products are not likely to help the coffee retailer much. Smoothies and Italian ice drinks are available at a huge number of shops, even Baskin Robbins. Starbucks does nothing to differentiate itself by coming to market with products that are easy to come by elsewhere. It is also a move away from its core coffee franchise.
The other issue with the new drinks is that Starbucks stores already sell scores of items. When custom ingredients are put together with the regular drink menu, most stores offer dozens of drinks. The stores also sell ground coffee and coffee makers. Add to that donuts, muffins and other food. Starbucks will also sell anyone who comes through the door music and DVDs.
Those new drinks are not prone to stand out.
Douglas A. McIntyre is an editor at 247wallst.com an author of the Ten Stocks Under $10 Newsletter.
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