|Google has been on a buying spree over the past few months. Just weeks after announcing the purchase of DoubleClick, the online advertising network, this week, Google announced the purchase of FeedBurner, the very popular RSS feeds website. With the kind of money that Google has been making, and also stands to gain through such acquisitions, it has become almost a regular 'Breaking News' from tech bloggers announcing yet another Google acquisition.|
This just got me to think what if Google decides to purchase PayPerPost. If Google has its way, such an acquisition will not be a great problem at all, considering that PayPerPost is such a small entity compared to the internet big shots that Google has acquired of late.
Why then should such an acquisition be of interest then? It is primarily because Google and PayPerPost stand at opposite ends of what is regarded an unbiased Keyword search. While Google's search results are displayed with the presumption that a webpage is linked with a particular anchor text simply because that webpage was considered a reliable reference for that particular anchor text, PayPerPost strives to exploit this by offering cash to bloggers who do just this.
For sure, Google shall not buy PPP simply to curb this search malaise. There are two primary reasons for this: One, simply because there are other 'blog for money' websites that shall continue with the legacy that PPP introduced, and two, there is simply no gain out of such an acquisition. If the user is going to get such flawless results simply through the organic search results, why is he even going to click on ads!?
So, if ever this acquisition should happen, there should be other criteria that in a way can help Google make money. Here is one way by which Google can monetize through PayPerPost.
PayPerPost sponsored blog posts are called 'opportunities'. Now every opportunity has one guy (the advertiser) who pays the money and one guy (blogger) who gets paid for making the blog post. This can be very well integrated with Adsense. For example, the Adwords advertiser can pay for a particular keyword, and an Adsense publisher (who owns an authenticated blog) can do the post and get paid.
Do the Search results get tweaked
Like the nofollow link, Google can require users to include a 'specific' attribute or comment inside the blogpost. Blogposts with this specific attribute shall not be considered for organic search results. Rather, they shall be displayed on the Ads side when a relevant search is made.
How the payment is made
The payment cannot be using the usual CPC format since the blogger needs to be paid for his work and $0.50 and $1.00 will not help. To achieve this, Google can introduce a new format of payment. Like the CPM and CPC, there can be something like CPP (Cost Per Period). That is, the Adwords advertiser may have to pay a specific amount for this blog post to appear on for relevant keyword searches for a particular period. This can be a one time payment without a concept of pay per click.
Let me explain with an example. Suppose I am a travel agency looking to woo tourists for the upcoming holiday month. Then, I can get bloggers to make a blog post using all the possible keywords that my potential customers will be searching Google for. The blogger gets paid $20 for this, very well knowing that he is not gaining any PR weightage to his blog because of this. I pay Google $100 for a strategically chosen one week during this holiday period, when I know the maximum searches for travel packages are made. So, inspite of the number of visitors I get during this week through the ads, I have paid only $100. Also, bloggers can make money out of this,and hence everyone can expect to be in a win situation.
This was just a hypothetical thinking trying to highlight the extent to which Google has started dictating terms on the internet. This acquisition cannot be as rosy as it loooks. There are quite a few drawbacks on such an acquisition. One primary fact is that there will be too many people willing to take to blogging on such things that either the proportionate number of advertisers will be less or the general quality of blogging as such will stoop to too low levels. Another very important aspect is that a chunk of revenues from ad clicks for Google is because of the fact that most people (believe me!) still do not know how Google actually makes money. In the sense that they have been clicking on ads without knowing that they are actually doing so. Introducing such a method of advertising will really stall the ad clicks to a halt in the long run as everyone grows intelligent!
Nevertheless, it is interesting to think of such deals going through, and by the way, sorry for the loong hiatus in making a blog post. I have been really busy these days.
- How Google Can Increase Chrome Market Share?
- Knol - It's NOT the end for Wikipedia
- Three reasons why Yahoo should not partner with Go...
- Google "Smartads" on Mobiles?
- Is Wikipedia a vulnerable tool for propoganda?
- Del.icio.us - Is Yahoo getting anything out of thi...
- Is it the end of the road for FeedReaders in India...
- What if Google buys PayPerPost?
- Ad Network consolidation
- Web History - the story inside out
Del.icio.us | Digg | Google | Reddit
Del.icio.us | Digg | Google | Reddit
|This April, Google announced their acquisition of Doubleclick. This was for a whopping $3.1 billion dollars. This has signalled the first step towards online Ad network consolidation. This is because, soon after, Yahoo too has announced their complete takeover of RightMedia. This was for $680 million (Yahoo already owned 20 percent of the company)|
For Google, this acquisition widens the entire scope of their advertising operations in the internet. This is because Doubleclick has a portfolio of products which Google can leverage. The most important is the DoubleClick Ad Exchange program. This is an impression based advertising network which connects the advertisers with the publishers. Doubleclick already enjoys a huge publisher and advertiser base, and hence Ad Exchange is touted as the next big thing for Doubleclick. This apart, they also have other products like Performics, something quite similar to CommissionnJunction, a website for affiliate webmasters). The acquisition hence takes Google much much beyond where they are, in terms of Adwords and Adsense.
Yahoo's acquisition too, is right on track, and with the acquisition of RightMedia, have taken the company that directly challenges DoubleClick Ad Exchange. These websites also manage the ad inventories for many other popular websites. Yahoo could also possibly take over Microsoft's advertising operations, if not be acquired by MS; which is a huge ask.
What does all this mean to you, as a publisher or an advertiser? With increasing consolidation comes increasing bargaining power. Google already enjoys such a huge competitive advantage, that they exploit with not revealing the share of money that the publisher earns per ad click. This acquisition widens the area where they can flex their muscle.
The same, however cannot be said about Yahoo's acquisition. Yahoo has come to be the second best always, losing out to Google. However, Yahoo's acquisition of RightMedia is more of a reliever, since this puts DoubleClick's direct rival also in strong footing. This will ensure that DoubleClick does not end up wiping away competition. The balance thus continues to remain steady. However, it shall be interesting to revisit this story after a few months where things will be more clear on the implications of such an acquisition.
Labels: Business Model Analysis