Michael Gracie

Allen Stern puts food on the table via blogging. It’s not a noble pursuit, but it is a sign of the times. His website, Center Networks, is a forum for discussion on “social networking, Web 2.0, and social media.” Mr. Stern is concerned his readers use Adblock, and/or don’t “interact” (i.e. click) on his ads. While he claims to target “mainstream” internet users, his sophisticated consumers are otherwise too “ad aware.”

I intend no malfeasance, but I do say get used to it Mr. Stern. Or better yet, use your knowledge of “blogging, video blogging, social networking and Web 2.0 issues” to find additional business models. You and your colleagues created this world, and now you must live in it.

The internet is all about free. When a consumer navigates to a site (usually after finding it via search) and reads your content, there is an implied contract in place. That contract infers that the content is available without charge. If someone re-uses (or otherwise adds to) that content, they must (or at least should) provide attribution. There is at least one exception to the re-use rule - the AP believes bloggers should pay by the word. But nowhere is it implied that the user owes the content creator any compensation for simple consumption.

I’ll add that there are a vast number of blogs hanging their hat on “Web 2.0″ and “social media” discussion. In other words, there is enormous competition - and most seem to be ad supported too.

When I combine the above with Mr. Sterns vocal concerns, I come to the conclusion that the field is on the verge of being cut.

UPDATE (a bit snarky): Nobody seems able to make money via ads ON social media, so why should anyone expect to make money via ads while talking ABOUT social media?

UPDATE 2: A second coming (of collapse that is)?

Saw this nifty ad on the top of a web page. I instantly felt bored. It said free, and it sounded like fun.

Cure for what ailed me? No such luck - I arrived here.

You can read on Thursday when you’re not so busy

• Don’t listen to analysts, or at least listen to them at your own risk. I’d rather just not listen.
• Some knucklehead (me) asked for an alternative to advertising models for “Web 2.0″ companies. Someone else tossed one out. Not very creative, and I’m still safe in the butt-kissing department.
• There was a heatwave on the east coast, and it extends into today. Out west, we are stuggling with the concept of sweatshirts in June (it’s in the mid 40’s this morning, with a projected high in the mid to upper 70s). The climate change frenzy was mute.

Side note: A really great dog passed away on Saturday after a short but valiant fight with cancer. Courageousness could be summed up as follows: just weeks before he left us (and just days before his diagnosis), this guardian of the neighborhood hiked up a 14,000 foot mountain peak like he was born yesterday. Saturday night we drank and played poker and talked about the good ole dog days, and everyone (including my own mutt) misses him already.

Pro features on the way.

Nice to see internet companies chasing ideas besides just advertising. People don’t mind paying for some things - for example, Flickr is good value in the pro mode and I’ll certainly re-up when the time comes as I really like the additional sets for organization (and don’t have time to abuse the bigger upload limits either).

Also of note - I created a simple Tumblr page to extract inline posts and comments from this blog, and had a little trouble getting my feeds in. The Tumblr help desk was very quick to the punch. While the problem turned out to be a temporary Feedburner issue for me, it’s nice to see a “free service” actually give you service, and I applaud Tumblr’s timely support.

Meanwhile, give me your kingdom, and I’ll show you yet another ad

Ashkan Karbasfrooshan gave a few good reasons why most startups clinging to what seems like the one and only business model, advertising, will soon hit the skids. The guy used to be an ad salesman - fair enough.

Meanwhile, Dan Frommer toots Tumblr’s new business model, which just so happens to be…no wait…why don’t you guess…uh…advertising? I’m pretty certain you guessed right.

Are there really that many advertisers ready and willing to throw money at what seems like a never ending and limitlessly growing supply of ad inventory? And on sites whose content is also limitless (and free), and which, when combined with their userbase, reflects so little intent to purchase?

The Techdirt folks champion the concept of giving away goods of infinite supply in exchange for goods of a finite nature (latest example here). Seems to me internet advertising might just be reaching that unlimited availability point.

Quick answers and not-so-quick speculation.

Barron’s: Google points out it isn’t doing so hot.

Alley Insider: Alas, the social network side of things is not up to par.

ZDNet: Not good, and Google is disappointed with the MySpace deal.

Techdirt: Cutting to the chase - it sucks.

And…Facebook isn’t looking like the grand saviour either.

Meanwhile…some folks are optimistic - Lookery is chasing the same kind of deals with social networks, while the GOOG says they’ve seen no impact from the economic downturn.

I’m on the fence. Click fraud is up, and the internet advertising king’s growth is slowing significantly - if they can’t make it all work, who’s going to? Microsoft may be buying Yahoo!, but Yahoo! has only ancillary properties representing social networking success while Microsoft seems to have significantly overpaid for what they have on the plate already.

I’m betting an upstart will hit the street with something truly unique in the way of monetization, and it will charge up this space the way the GOOG did with search. The incumbents should be looking over their shoulder frequently, as there are no barriers to exiting their networks.

It is always cute to see companies attempt to take the high road regarding their promotion. We all know it is all about the greenbacks, so while 888 Casino denounces blog spam, you know someone will keep on trying, because there is money to be made. If they really wanted to stop uncontrolled, unethical promotion, they would simply halt the affiliate or other promotional program that is at the root of the issue, but we know that isn’t going to happen (think 180Solutions).

Everyone is guilty, somewhere, somehow. Unfortunately, the contextually driven nature of the internet makes it diffficult to manage. Case in point: you’re a high-profile political blog who mentions the word Connecticut. There are big casinos in Connecticut. And although online gambling is technically illegal, your sites feeds are bound to grab a casino ad sooner or later. Whether you throttle that advertiser next time around depends on you (and, of course, whether you are making tons of cash off that ad).