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Summary:

Jim Spanfeller is president and CEO of Forbes.com. He is also treasurer of the Online Publishers Association and chairman emeritus of the In…

imageJim Spanfeller is president and CEO of Forbes.com. He is also treasurer of the Online Publishers Association and chairman emeritus of the Interactive Advertising Bureau.

After years of debate about the value of the near monopoly owned by the folks in Redmond, it would appear that this particular discussion is quickly moving south to the Googleplex. And from where I sit, appropriately so.

For some time there have been murmurings about the relative value generated by Google (NSDQ: GOOG) vs. the parasitical nature of its business model. In short, is Google being disproportionally compensated for what is fundamentally other people

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  1. John C. Smith Tuesday, May 5, 2009

    This is one of the most ridiculous things I've ever read.

    It's hard to know where to begin.

  2. invitedmedia Tuesday, May 5, 2009

    i clicked through comment hoping to ask "who the f is this guy who wrote this thing?" … but the previous comment seems to sum it up better.

    sheesh!

  3. Hmm..

    "After years of debate about the value of the near monopoly owned by the folks in Redmond, it would appear that this particular discussion is quickly moving south to the Googleplex. And_from_where_I_sit, appropriately so."

    No need to read any further…

  4. Dave Mastio Tuesday, May 5, 2009

    Jim,

    I am a fan of Forbes, have read it for years and you guys bought my first professional magazine article.

    That said, could you please spell out what Google features violate fair use? If you want them to stop, you have to be specific. I hear media companies complain about this all the time, but I can't get a straight answer on what exactly you want Google to stop doing.

  5. By Jim's calculation, if you figure Google has been indexing Forbe's news content for 5 years making $5MM, $10MM, $20MM, $30MM and $40MM from Forbes content– they owe Forbes about $110MM; however, I don't think that the retro-active payment solution is viable but Jim's 3 recommendations seem to be reasonable asks for Google, at a minimum as the beginning of a dialogue.

    It is worth noting that Yahoo & MSN have been successfully collaborating with content partners, making money, supporting the partners media ambitions and creatively solving for user demands. Both MSN & Yahoo refer measurable & agreed upon traffic. Last I checked, Yahoo! Finance was still a larger business than Google Finance — they have a strong & long relationship with Forbes.

    <I guess John is accustomed to reading the ridiculous things that come before premium, established, well-written content and doesn't see the value of editorially produced content…>

  6. The horse has bolted and isn't coming home. Brands will in future be defined and affirmed socially. The good news is that content providers who learn how to be profitably portable (kindle, article banks, tailoring etc.) will survive and Google's relevance will gradually erode.

    My search activity is down by 75% this last year in favour of canvassing opinion across my social networks. Unless Google buys Facebook and/ or Twitter, which would be a horrible thought, I suspect it's growth curve is flattening.

    In terms of Forbes, I know how they could stop getting mad and get even. But that would cost….

  7. Jim Spanfeller seems to be prone to oral malfunctions. He might want to take a harder look at Forbes.com if he wants to clean up the online cesspools.

  8. Few people know the web and the web business model, both from a content and advertising perspective better than Spanfeller.

  9. Oddly enough, I go to http://telegraph.co.uk frequently, and http://economist.com, and the like – and I *never* use Google to get there! Seems like Mr. Spanfeller is condemning his errant flock for their bovinity – they get a browser (doh! – probably IE, with it's default settings..) never alter anything, and believe that the way to get to a site is to type the URL or the search term into the 'big thingie' in the middle! It is amazing to me how many users persist in this misconception, but try it – ask your pa, or grandma, how they find stuff on the Intertubes. I'll bet you'll be amazed at how many people believe that the default Google (or MSN) search form is in fact the browser's address bar.

    If you are more interested in repeat visitors than one-shots (I would imagine your advertisers would be, wouldn't you, Mr Spanfeller?) perhaps your programmers could come up with a clever way to discover where the user originated *on his browser*. Perhaps a high-tech thing, like a survey! And perhaps you could design a fix!

    Or perhaps, like some of the more creative investors out there, you could own a piece of a fix, much as bit.ly is owned by O'Reilly, and Mitch Kapor (among others.) So much more Forbes-like than whining..

  10. There is no doubt in my mind that Google has been the primary cause of the rapid destruction of the economic model for premium content both in print and online: 1. Google radically lowered barriers to entry in the publishing world thereby enabling all kinds of content creators to monetize long-tail searches and flood the market with content and 2. Through Adsense, Google has developed a far more measurable and effective means of marketing to consumers than print, branding, or online display advertising. There is a third cause: the display ad networks with their reach and data driven targeting outperform premium publishers at a tenth of the cost. Jim and the premium publishers can only blame themselves for the third one, since they enabled the ad networks to succeed through short term greed.

    But it is still presumptuous to suggest that Google should change their algorithm to preserve the disrupted business model of premium/professional content. If consumers prefer a premium search algorithm or feel Google is inadequate, competitors like Microsoft could begin to compete with Google. And if said premium algorithm started to get even a little traction, Google could potentially respond by creating a filter or algorithm that provides similar functionality.

    But I also think that Google could be vulnerable here…because much of their revenue comes from non premium publishers who run adsense.

  11. If Jim Spanfeller was a great Internet person he'd be working for a serious Internet company instead of working for a old media company that is partially owned by private equity. I'm not buying what you are selling my friend!

  12. Was posted by: Jenkins….

    "Few people know the web and the web business model, both from a content and advertising perspective better than Spanfeller

    Mr Jenkins,

    That is not the case. Truly.

    Best,
    Mike

  13. Old media is panicking, this is just the latest beatup by a list of old media like murdock,
    It would take less than a minute to block google from your websites so why don't you do it?
    I will have to answer that with another question how much does old media make from google sending them web users?

    Lets face it they stuffed up their gravy train and are now behaving like petulant children.

    For years you have abused old media with your often undeclared political agendas, pushed products / politicians / agendas disguised as news, vilified your opponents with little accountability.

    It it you who have devalued your own brands and undermined prized journalistic institutions

    wake up and smell the roses old media dodo.

  14. Sam@dogseizures.net Wednesday, May 6, 2009

    In all kinds of business, there's always a two way relationship. One needs to give while the other one needs to take or vice versa. No one can survive by just relying on himself. Same with this situation, google needs users when it comes to revenue generation to be operative, as well as users need google when it comes to service.

  15. To those of you who think that Google's appropriation of headlines as "snippets" falls under Fair Use provisions of copyright law, you're wrong. Fair Use is a narrowly written provision in copyright law which limits usage to educational/non-profit purposes and primarily excerpted/abbreviated content. Who in their right mind thinks that Google's use of news headlines falls under "educational/non-profit purposes"? Anyone? Anyone? Bueller? This assertion is ridiculous to the extreme. Google is a business enterprise that receives advertising revenue for traffic. The news snippets create traffic revenue for Google. So, it's not Fair Use.

    Quite frankly, I'm a bit shocked that Google has taken the position that its use of snippets falls under Fair Use. Because that argument is DOA in a court of law. No judge is going to agree with that ridiculous interpretation. Google is going to have to pay content providers. It's that simple. Otherwise, it's going to get its head handed to it in court.

  16. @pb: Lets face it they stuffed up their gravy train and are now behaving like petulant children.

    No, pb. They're just asking to be paid their rightful share of revenue.

    People like you, who criticize the media for not being "innovative enough" need to wake up to the reality that the news organizations generate a lot of content, it's expensive to create that content, and companies like Google are leeches. What is Google contributing to the news? Nothing! They merely index what other people create, and then they consume the advertising revenue that results.

    You think this is fair? Of course it's not fair. Google should be sharing revenue with the organizations that provide it with content. But, no, Google is a greedy corporation (note: they recently removed the "Do not be evil" provision from their company charter — probably because they already violated that tenet with this kind of behavior) that wants to maximize their revenue on the backs of others.

    Worse, they want to enlist your help as a member of the Internet community to villify the same people that provide news content. Who else is going to step into the breech and provide content when newspapers and media companies fold? Bloggers? You're kidding yourself. Bloggers similarly feed on the work of the AP, UPI, and other news organizations. They're not pounding the pavement investigating so-called boring crimes and stories that newspapers and TV cover. They provide commentary. Big difference.

    You criticize the media's agenda. I agree with you on that. The media is often biased. But, on the whole, there are a lot of stories that blanket the political spectrum, and those stories would not be possible, if the media were to disintegrate into chaos. Government without oversight would be a horrible thing.

    Think about it. You haven't thought this through.

  17. The take away that I get from what Jim is saying is that search creates no demand. I turned down a sales job at Google a few years ago (whish i had those options now) because i couldn't get over the fact that paid search is digital yellow pages. It is great if you know what you are looking for. However, If you dont know you need a product or service, you will never go search for it. Display advertising (online or offline) creates that demand, i dont think anyone would argue with that. Google now takes credit for that demand (search) that was created by the advertiser through the branded content channel and other marketing efforts from the advertiser. Couple that with users using search as their browser and you have created a mafia type scenario where Google goes to an advetiser and essentially says pay me for your brand name on search or i will break you store windows by selling your brand to someone else. Even though that advertiser has spent millions creating thta demand…..That is illegal in most parts of the world, why is it ok online?

  18. Sramana Mitra Wednesday, May 6, 2009

    I agree, there is something unfair about Google making money off the names of brands that are actually created by the brands themselves.

    Also, here's a piece I wrote on The Future of Journalism, which may be of interest:
    http://www.sramanamitra.com/2009/03/01/future-of-journalism/

  19. Someday the people at Forbes will figure out search. Maybe. In the meantime, their hubris ("our most prized journalistic institutions.") is good for everyone else who has a clue.

  20. I am appalled that an educated journalist could write an article that displays such a poor understanding of fair use, search, and the internet. Shockingly poor 'analysis'.

  21. Hire a good Search Engine Optimization specialist and it will solve all of the problems you've addressed. What's that? A search engine optimization specialist is a professional who understands Google's algorithm and knows what type of content will rank and what to do to make your content rank.

    In days of old, after a writer would create a piece of content, an editor would read it and make sure it is appealing to the public, free of errors, the right length, etc.

    For major sources of "paid" content to survive in today's environment, they need a search engine optimization specialist to read their content and make sure it is congruent with search engine algorithms.

    Google is like a library. An SEO specialist is a Google librarian.

    If you hire them, your content will show up where it needs to be and you will succeed. If you don't, you will fail.

    Res Ipsa loquitor

  22. "Google is like a library. An SEO specialist is a Google librarian." interesting comparison.

  23. I do agree that people risking their lives in the field should be destinguishable from other people posting an opinion about that very same person… Point being that this original content claim has some validity. Currently, google has no way of addressing this, or letting users see for themselves the differences between these types of media.

    I don't understand how markets wouldn't fix this on their own. The implication in this article is that people are trying to find professionally generated content, but are somehow unable to find it or are being misled to other places. If this was true, why wouldn't some other search engine be able to address these consumer demands? I do not believe that google is a monopoly, people have choices that they are willing to use if they were better than google. Are people being forced to use google? Would they not use a 'better' alternative?

  24. Shyam Somanadh Wednesday, May 6, 2009

    The gem in the piece is where it is mentioned Google makes "$60 million a year" by sending folks to Forbes. So, if this is bad money, will Forbes return the money it made from impressions generated by traffic generated by Google for Forbes?

    Gaming distribution is not a new practice. Distribution guys have done it even on newsstands even before the internet was discovered. Everyone games the system. Being Forbes, they can easily buy a hoarding due to who they are on Times Square and claim to be the world's business content. I don't hear any cries of gaming in that instance. It smells foul only when it does not work your way.

    And seriously, when will they ever stop complaining about unfair use? Just block the crawlers and put a "no-index" on all the pages. But sales will then complain about the hole left in the balance sheet by the missing Google referrals.

    Think about it. Today is not something that happened overnight, it has taken years. What has any of these guys done other than to carp constantly. Where have they innovated. They allowed this to happen to themselves.

  25. Why, if established media consider they, and only they, provide such quality, are their opinions so….well, 1997?

    Don't think Google is treating you fairly?

    Simple.

    Block their spiders from crawling your content.

    Go on. Do it now. We'll soon see who provides who value.

  26. Kevin Cabral Wednesday, May 6, 2009

    re: the $60 million estimate. I am astounded that the Chairman Emeritus of the Internet Advertising Bureau does not seem to precisely understand how Google works or makes money. That's the only way I can fathom that he could believe such ridiculous estimates in which Forbes somehow accounts for 0.5% of Google's revenue.

    But help is on the way. Google can actually help "professionals" like Forbes to create the search engine of their dreams. There's nothing stopping these publications from licensing a search technology, including Google's, and indexing the sites and content of their choice. With the relatively high PageRank popularity of Forbes, et. all Google could actually help these folks to promote their "selective" search engine.

    I've blogged about this more here:

    http://bitsandthesis.com/2009/05/05/how-the-media-can-clean-up-the-cesspool-itself/

  27. It is frightening that a man in Mr. Spanfeller's position has such a poor understanding of search. It is more frightening that some of the individuals in this space completely miss the point and agree with this befuddled gentleman. This article specifically attacks Google for forcing companies to "buy their own brand names." This does not happen. It's considered 'black hat" and it will get you banned from Google to buy other companies brands.

    Next, fair use. Google can do more for books, news and articles than any single entity in the world. For those of you who defend Jim's article, can you imagine a world without Google? Can you put the genie back in the bottle? No. It's easy to point at the most successful business in the marketplace and accuse them of wrong doing or a lack of empathy for "the little guy". It's a big target. Google is a search engine. It's job is to find the content you are searching for. It does. No one is being ripped off here.

    This fellow is in a position of leadership with Forbes. He is the freaking past chairman of the IAB and he doesn't have a full understanding of how Google or the Internet works! There is your problem. It's clear that the "professional" content providers are merely trying to make a case that they deserve to appear above the multitude of untrained pee-on hacks that could not possibly produce anything that people, our kind of people (wink, wink), would want to read. Jim, if you are searching for news, you will want to click the "News" link on Google. I am sure that related articles will appear properly in the proper space.

    Finally, Google has a business model that works. Forbes…well let's just say that Forbes along with a lot of other traditional media based companies are still looking for their viable digital business model. It must sting Jim.

  28. @Tom
    Well Tom you are quite wrong about me not thinking about this, I have spent decades on this very subject since trying to persuade several local newspapers and community orgs to go on line in the late 80's.
    Ok so they did not have a clue what we were on about and at 2500baud it was a pretty limited experience.

    But that's not the point any site can stop a search engine in a matter of minutes why don't you read up on Robots exclusion standard at wikipedia and then tell me why the dodo's do not use that mechanism that takes minutes to set up?

    I suggest its because they derive value from search engine hits and therefor are full of it and these type of stories are a beat up.

    I stopped buying newspapers several years ago but test the waters at least twice a year.
    They have not improved and still show bias, pretend advertisments are news
    They do not publish criticism, when forced to do a retraction they put it in tiny print as far from the front page as possible and on and on…

    The web is not better but I have more choice, and the criticism is open for all to see
    I can tailor the news to what aears that interest me, there are even old media sites that I frequent, to say Google is killing them is rubish,
    they have not evolved they still exist in a 70's time warp setting type!

    pb…

  29. Peter summed it up.

    At any time, any content producer can block Google from indexing their content. They can ensure that Google makes no money off of them.

    No one does it because Google provides traffic and viewers which for companies like Forbes results in revenue.

    To the extent that the value derived from letting Google drive traffic is more than if they did not drive traffic, Forbes has nothing to complain about.

    If you don't like a store, don't shop there. If you don't like Google, don't let them index your site. It is in your control.

  30. Mike Tellman Wednesday, May 6, 2009

    Hey Jim,

    This is the most ridiculous article I've ever read here. A complete NONSENSE!

    Just face it: all you parasites from traditional media are slowly dying and now you're trying to save your jobs. But guess what: that ain't gonna work!

    Hey Jim, I don't think you'll need a resume for digging ditches once you get fired from PC…. and I'm sure you'll be more productive at digging crap than writing crap.

    Mike

  31. @Tom

    "But, no, Google is a greedy corporation (note: they recently removed the “Do not be evil” provision from their company charter—probably because they already violated that tenet with this kind of behavior)"

    Are you referring to the 3rd result on http://www.google.com/search?q=Google+don't+be+evil ?

    You DO realize that article was an April Fool's joke, right?

    "Don't be evil" is still prominently displayed at http://investor.google.com/conduct.html

  32. There's no online advertising without google. Maybe many of forbes.com visitor dropping to the website first because of google search, then become a loyal visitor and straightly bookmarks the website, to directly visit forbes.com regularly. So, Google is our internet saviour. They work hard to make internet as a huge market for online advertising. Say thanks to google. What I didn't like much about google is PageRank. I wish PageRank is deleted from internet dictionary :P

  33. I see where you are coming from, Jim. I run a company that helps content publishers earn money from their content because normal advertising isn't enough anymore, and although my business relies on commercialisation of content, I value and respect quality independent journalism, and am saddened (perhaps nostalgically) that the way the web has developed is making it difficult for this to continue without drastic change.
    I love the innovation Google has brought to the web, but sometimes I think that teaching us all that everything should be free and financed by (their) advertising is prohibitively challenging for many companies. But, this is the way technology has always evolved, and the only way to combat what you don't like is to innovate rather than to prohibit.

  34. it's just amazing how many businesses
    want to grab a chunk of google's money.

    -bowerbird

  35. Jim makes a good point, perhaps if he got his wish then Forbes will STOP publishing those ridiculous wealth-porn content packages/slideshows of " executive bikini beaches etc, these simply over inflate Forbes traffic numbers so Forbes can continue believing they are in the same league as WSJ.

    Interesting to see WSJ & FT legitimate traffic numbers continue to increase and Forbes "holding steady".

  36. realy good articles from today i read every day

    officialtech dot com

  37. Amazing that such a lack of insight and logic can come from a guy of such position

  38. Forbes.com is a joke. It's gotten slightly better over the past year and it's STILL the ugliest, least readable, least user-friendly content site in the western hemisphere.

    This comment from jenkins nailed it: "[Jim] might want to take a harder look at Forbes.com if he wants to clean up the online cesspools."

  39. Michael K Pate Wednesday, May 6, 2009

    "At Forbes.com, we have estimated that Google makes roughly $60 million a year directing folks to our site. And by the way, 40 percent of those dollars are derived from the search terms of Forbes, Forbes.com or Forbes Magazine—simple navigation. Seems like a very nice chunk of change for simply being there."

    If you don't want to be included in Google search results, a couple of lines in a robots.txt will make that happen. Of course, chances are, that will impact Forbes revenues a bit more than it does Google.

  40. cesspool of the web = slideshows on forbes.com
    the one I saw today was America's most popular dogs.
    come on, jim, you guys are trying to trick the web just like google. your problem is that google's tricks trump yours in spades.

  41. The people crying noindex are using faulty logic. I should not have to deadbolt my door to expect not to be robbed. You are implying google has a right to my content unless I tell them otherwise. I'm not so sure.

  42. Brian Ratzker Wednesday, May 6, 2009

    I think Jim Spanfeller is finally feeling the effects of over advertising on Forbes.com. Nobody wants to read a website that is filled with Ads. Furthermore, Jim should never be criticizing anyone, Forbes has the least respect for their advertisers than any publisher I have ever seen. They have done some horrific things to drive up their monthly impressions in the past and I am sure they are still willing step over that line today as well.

  43. How ironic – someone representing a magazine built to celebrate free enterprise and capitalism is criticizing Google for building a popular, successful business model. As for the $60 mil Google is supposedly making from sending people to Forbes.com, how are they making that money? It doesn't appear that Forbes is running paid search ads, so Google wouldn't be making any money off of sending people to Forbes.com. Are you aware how search works Jim? You must not be, or else you wouldn't say that Google forces you to buy your brand name so competitors cannot. This is wholly inaccurate – competitors can buy your brand name regardless of whether you are, and if someone doesn't want a consumer to click on a competitor's ad instead of their own, then strengthen your own brand messaging so as to make the difference between yourself and your competitors clear and compelling. If anything, Google driving traffic to your site should allow you to make MORE online advertising revenue. Google is helping people get to your site, and as your traffic numbers and usage metrics increase, your site becomes more valuable as an advertising vehicle.

  44. Spanfeller might be correct. It is high time for the regulators to deconstruct Google's "business model," which to me is highly questionable: first, it supported the creation of an enormous maze of "free" and often spurious or phishing websites (or Mr. Schmidt's "cesspool"), then, it started to insert "paid" traffic & navigation signs to get you through or out of the maze.

    But Google's model would not work without another key component, that is, the (false) theory of "free is always better," popularized by Clay Shirky and other paid consultants to the Web 2.0 industry. That the theory is false was proved by the famous Radioheads experiment and then the successes of the online gaming industry, Second Life, iTunes, WSJ and many other paid sites and services.

  45. Jim Spanfeller Wednesday, May 6, 2009

    Thanks to all for your comments. Some interesting, some kind and others…well…not so much. But all nonetheless appreciated. It would appear that some folks have mis construed some of my comments but regardless the debate is good. On the Forbes.com front, I did want to note that our traffic numbers and ad effectiveness are measured in a vast variety of ways, from Brand Studies to lower funnel review on the back end and via the only MRC certified ad serving system in our category on the front end. So while everyone is very welcome to their individual perceptions of our site, I can say with full confidence that we have a very workable model that is fully certified (and in fact has always been held to a higher set of metrics when it comes to audience counting then our competitve set) and well received. We are also the only site that I know of (still to this day) that offers a money back guarentee on brand advertising effectiveness. We have been offering this guarentee for over 5 years so at this point I have to believe that others must have followed suit but if so, I am not aware of who they are. For those of you that expressed displeasure with our offerings all I can say is, sorry. I do hope you will keep checking back to see if we have developed content that you find value in. We will certainly take your comments to heart as we continue to work to make our offerings better. That said I would be remiss if I did not say to the 20 million of you that come to Forbes.com on any given month…THANKS!

  46. Jim,

    Tell you what. Put your money where your mouth is: put up a robots.txt file and block googlebot. That'll show'em!

    Then spend some time trying to clean up that mess called forbes.com. At the very least I think Malcolm would have found it to be profoundly embarassing.

  47. Andreas Ramos Wednesday, May 6, 2009

    Jim Spanfeller's concerns are widespread among corporate CEOs. Their brands are under attack.

    Regrettably, Google does very little to explain how Google’s search engine works. Google makes a great deal of money from advertising by third-party vendors. It is in Google’s interests for the current situation to continue.

    Corporate brands indeed have value; that’s why domain name squatters, third-party advertisers, and affiliates hijack the brands to sell their copycat products. It is fairly easy to calculate the value of a brand on the web.

    Forbes and CEOs need to understand how search engines work so they can counter Google on equal footing. They can not negotiate if Google holds all the cards.

    yrs,
    andreas
    http://www.andreas.com

  48. No, seriously Jim, your article makes no sense. It's filled with gaps in logic, unsupported assertions, and, well, whining. I have no idea what you're trying to say except that you feel wronged by Google, and I really have no idea how.

    Take that $60 million figure. I call bull$%!#. So feel free to offer some hard numbers for that figure anytime you like…

  49. All this article shows is that Google is smarter more aggressive and more powerful. Is it a surprise they are going to profit off your work, of course not. Google is on a mission to organize all the worlds information and make it accessible. No company person or government is unaffected. Welcome to a world of Google.

    And do you know why Google will succeed, because people of all walks of life including very important people want access to this information and they have found a friend in Google.

  50. David Steinberger Wednesday, May 6, 2009

    The ad economy is broken. The middle man model that is media is broken. It's not Google's fault. It's not anyone's fault. But it's your fault if you don't see it.

    What Google has done, is begin to apply the laws of supply and demand to advertising and it's shining a bright light on how much inefficiency we've been living with.

    It sounds like Mr. Spanfeller, like others clinging to an outdated model, wants to go back to a world where a small cartel like group of media companies sell a scarce supply of eyeballs to advertisers who have little to no alternatives.

    Quit fighting the laws of economics. Media companies no longer have a stranglehold on supply of consumer time and attention and therefore must lose their control as middle men. More on my blog…www.OurSeatAtTheTable.com

    -Dave
    -Dave

  51. To better understand what Jim (and many other digital content providers) mean, imagine this:

    You have a product, say, new line of clothing. You want to sell it to the local super store carrying thousands or in fact millions and millions of similar items — it is a huge world wide store. The store says, "Fine. Welcome on board! We are so great, that we will display info about your product and direct our customers to your shelf, if you agree to carry a few third party's ads for us. You might even earn a few bucks in return. And BTW, if you offer your product for free, we can guarantee that even more customer will find you using our in-store directory. You know: free is always better."

    But you do not want to be an advertisement board for others, including your competition, especially that it is mostly the Store not you who gets the ad revenues. You cannot offer your product for free.

    Then the Store say, "Then, sorry, but we cannot help you. You can of course place your product somewhere in this huge huge store — we are open to anyone; the more of you out there the better — but, look, who is going to find you there without our help? It is a cesspool, a maze of tags and key words. You MUST use our assistance or else…."

    Don't you see anything evil in this seemingly free and helpful Store, really evil?

  52. William Felt Thursday, May 7, 2009

    There's no point arguin with a parasite.

  53. @jimspanfeller

    Unlike my fellow commenters, I think most of your points are valid and important.

    But could you please substantiate how Forbes.com arrived at the estimate that Google makes $60 million directing folks to forbes.com? That sounds a bit far-fetched.

  54. Why are "professional content producers" better than so-called "amateurs"?
    Why is "professionally created content" better than "non-professionally created content"?

    Do users actually care if the website they're reading is "professionally created", or do they care that it's _relevant_?

    Google (and other search engines) return (arguably) _relevant_ results. The Google search engine is dumb. It's an algorithm. It says "Tell me what you're looking for and I'll try and give you a link to it". It does this without human bias, using mathematical formulae. If a "professional" article is so much better than an amateur one, why does Google's algorithm not pick it up? Perhaps "professional" does not equal "best".

    What media producers have to realise is that the old ways of 'produce lots of content and distribute as one lump' is gone. *FOREVER*. Quality trumps quantity – especially when people can dive in to specific strands or articles.

    Consumers no longer have to read/buy a whole newspaper or magazine to find the news/information they want, they can pick and choose from the different articles on that vendor's website. Consumers no longer have to buy an entire album to listen to the songs they want, they can go to a digital distributor and download the individual tracks. Consumers no longer have to buy or subscribe to an entire encyclopaedia to view a single topic, they can go to Wikipedia and look for the specific article they want.

    Search engines like Google's look at the content, and see if it's what the user is searching for. If they're not searching for terms related to what you're producing, are you surprised they're not finding your content?! if you are, you should consider retiring because you're going mad.

  55. "I can say with full confidence that we have a very workable model that is fully certified (and in fact has always been held to a higher set of metrics when it comes to audience counting then our competitve(sic) set) and well received."

    After reading your claims, I decided to visit your web site.
    After seeing the html abomination that is forbes.com, I can see your complaints.

    Like many other media companies, you focus is on flashy presentation rather than content delivery. Google is a content spider. I see little content to crawl, just a bunch of 1998 web design littered with frames and javascript.

    As suggested above, I recommend an SEO specialist. I also recommend a complete redesign of your site, using no frames, less JS, and perhaps even w3c standards.

  56. The points in the article are indeed accurate.
    1. At the moment, companies bid large advertising budget allocations to Google to simply conquest their own trademarks on Google's AdWords. If companies fail to do so as a defensive measure – their branded trademark is instead auctioned off by Google to the highest bidder. eBay should not be empowered to buy the trademarked "Elvis" keyword on Google – nor should Acura be able to buy "Audi" keyword (nor visa-versa). I anticipate this broken paradigm will end soon as I believe we'll see a precedent setting ruling as a result of this case here:
    http://74.125.47.132/search?q=cache:KwWdyUp6xdQJ:w2.eff.org/legal/cases/rescuecom_v_google/06-4881-cv.pdf+google+rescuecom+appeal+ruling&cd=2&hl=en&ct=clnk&gl=us

    2. Online publishers/bloggers (off all types) win far less traffic value from Google than Google wins ad $ from crawling and posting publisher/blogger content on the Google Search Results pages. The traffic value is now relatively inconsequential. The reciprocity is simply broken. The value exchange used to be more balanced – what changed (summer 2006) was that Google discontinued their 'content on the left and ads on the right' model. Google started including their ads on the top-left above the content results – which resulted in less traffic.to.publishers and more ad.click$.for.google. Google basically changed the terms of their implicit deal with all of their publisher content suppliers.

    I'd suggest two changes for Google:
    a) import the PTO database of trademarked names/terms – and program the Google AdWords algorithm to not offer these words (which are someone's intellectual property) in the auction, and
    b) discontinue running ads on the left side of the results page. go back to 'left-side = content and right-side = ads'.

  57. I fully agree with this article, Google is horrendously leaching off magnificent companies such as Forbes.com.

    Along with this, I have noticed several local 'convenince stores' are also selling copies of Forbes magazines, by displaying the Forbes brand no less.

    Appalingly these companies, despite producing no content are taking a significant cut from the sale of these magazines. All these companies are providing is a convenient means of accessing content, the same pitifully useless service as Google. Some of these stores will even sell spots traditionally housing Forbes to other magazines, which should certainly be illegal.

    Damn Google and damn covenience.

  58. This is a great article. The people who are complaining have probably never run a website that runs Google ads. Try to find out what Google pays–you can't. Their model is that they'll tell you after you're already signed up because you are too stupid to understand their complicated pricing which only Google people can handle.

    Google's profit margins are something like 75%. That's 75% of the money going to Internet advertising that is NOT going to content creators. This figure is completely Google's choosing. The rules of a market economy let them charge whatever the market will bear, but if you believe in market economics, you also have to accept that the less money flowing to content creators, the lower the quality of the web because content creators have lower margins and less money to work with.

    In other words, instead of going to content like it did in the heyday of newspapers, money is now going to fund nutty Google engineering projects that never make any money.

    Even worse, these half-finished beta projects are given away for free, so not only are we not getting good journalism, we are also getting crappy software because competitors can't make any money selling a product or service at a reasonable price. While it is arguable whether Google has a monopoly, it is a principle of anti-trust law that when one player gives away products lower than cost (called dumping in other industries), it is destructive to the market and innovation.

    For those of you who think Google is so great, think of the kinds of websites Google's ads have spawned: pages of nothing but keyword spam, with either no content, or content taken from Open Directory and other random RSS feeds. Completely useless. If Google were treating content providers fairly, we should be able to name a slew of great websites thriving with its products.

    Compare this to the innovation unleashed by the iPhone, and the increased music sales generated by MP3 players and iTunes. Apple doesn't do everything right, but they understand that content creators have to be rewarded. The 30% they take for iPhone apps seems more reasonable compared to Google.

  59. @Brian:

    Okay look…when you sell your product at, let's say walmart…who takes a big chunk of the profit?is it you or walmart…something tells me it would be you…so if google puts its product on your website (ad links) why would you want them to give you a bigger chunk of the profit?this does not make any sense!

    now as far as auctioning trademarked words goes — consider the case where you enter the word sony as a search term, does this necessarily mean you only looking for sony products?well i dont think so…now a search engine would offer up links to other companies that offer similar products…so that being the case why cant this search term be incorporated into algorithms that serve up ads?but the truth of the matter is when you search for sony the first link (not an ad link) that's offered is a link to the sony's official website and guess what…if you click on it google doesn't get paid!

    and to re-iterate the theme of most comments above…

    WHY ISN'T FORBES BLOCKING GOOGLE FROM INDEXING ITS SITE?

    http://www.google.com/support/webmasters/bin/answer.py?hl=en&answer=35302

  60. First a disclaimer: I work for Microsoft and responsible for our Institute Ad Effectiveness Research. Second, there's a lot of science that backs up your thesis. The reason why Google gets so much credit for incredible ROI is because of measurement standards, not value delivered. Associating traffic and sales simply to the last click before the consumer comes to your site is the way 99% of the world measures success online. Sadly, that prior click represents only 6% of the reach, engagement and clicks that consumer has had with your brand on the web. There are countless studies that have proven display advertising and TV ads drive traffic to advertiser sites, often through search engines. We published a study that showed that sponsored search clickers who are exposed to display ads from the same advertiser have a 22% increase in conversion rates (over search ad clickers with no display exposure). No offense to any readers, but I've found that the folks who disagree with this fact of life often have careers dependent on perpetuating this mythical value. You're pointing out that "the King has no clothes" and it's about time. The current myopic view of the Last Ad Standard is not sustainable. It simply is too far of an abstraction from reality. Those who have built businesses around it will have a rude awakening indeed.

  61. Mr. Spanfeller…you are an idiot. I used to think you were probably a pretty bright guy, given your CV. But if this article is evidence of anything, it simple confirms that sometimes, stupid people are promoted to obscurity.

    As others have stated, if you are so unhappy with Google crawling your site…SHUT IT OFF! That power resides entirely within your IT organization. So either do that or STFU!

  62. What Jim has neglected to mention are the millions of users who normally won't go to Forbes.com that are being directed to his site via Google (especially organically). As we know, these impressions have a value and contribute greatly to Jim's bottom line.

  63. Jim, Google is a tool. Learn how to use it.

    1. If you are searching for professional reportage, you perform your search in Google News, not Google Search. You can actually perform the search for 'Gaza', for example, under regular Search and then click on News to view the professional, and timely, content.

    2. That you admit Google makes $40 million a year directing people to your site by using search terms containing Forbes, Forbes.com, and Forbes Magazine, is an embarrassment to your institution and your marketing staff. You are a leading and recognized company. Your web pages are often the first 'natural result' of many searches, especially those of which contain your name. If your marketing staff has not filtered your ads from a natural search, they simply have not been doing their job and have been costing you money.

    You're holding the hammer by the head not the handle.

  64. There are only 2 companies buying your beloved brand name in Google. They are Fortune (a Time company) and Magazine Discount Center, Inc. One is selling a competing product and one is selling your product (with a few other options). Do a search for "forbes" and you'll see what I mean. Send them a nice little cease and desist and you'll clear that one up quickly.

    If anyone else is showing up for a forbes magazine search it's because they're broad matching on magazine, like Amazon for example.

    But all in all, I hardly believe that these 2 advertisers bidding on your brand add $60 million to Google's pocket. I'll give you about $30k a year, maybe.

    I'm sure the effect of incremental traffic courtesy of organic search results for forbes.com is much more valuable to your ad revenue than to Google's, especially for your brand name.

  65. William Ellerman Friday, May 8, 2009

    I understand that you want your brand to show up, but part of the value of a search engine is that it is a way to find new content. If a searcher is looking for professionally written content, they can use Google News, or go to the website directly. If I'm looking for forbes.com's opinion on an issue, I will either use the site: search command which will feed me results only from the Forbes website or I will go directly to the site and find the information I need that way.

    People searching for branded terms already know the site exists and you will probably have the top organic rankings for most branded term searches, especially if you are such an authority domain as Forbes. Therefore, you are over investing in paid ads for your branded terms. You should decrease that spend and invest it elsewhere, like expanding your brand and ranking for some of the non branded terms like the Gaza term you mentioned. That would increase your brand awareness.

    There are so many solutions to the problems you are complaining about. Invest some of your massive spend in a good internet marketing agency that can help you solve your problems rather than just write an article about them.

  66. Dale Harrison Friday, May 8, 2009

    The future of media will not be anything that looks like the current structures…

    A lesson worth remembering is that at the turn of the 20th century, people had a transportation problem…and the solution turned out not to be a "faster horse"…but a Ford.

    And one should note that the Ford didn't arise out of the "horse industry's" R&D efforts, nor the "Horse Industry Revitalization Act" nor the horse industry's attempts to experiment with new Business Models.

    I think the future of the media business will look as different as Ford and Toyota's operations look from horse traders and blacksmiths.

    ——
    What's historically given value to editorial content is the relative scarcity of distribution versus readers (not the Kindle kind). Newspapers have historically enjoyed natural localized economic monopolies that allowed each of them to exercise monopoly control over the amount of content (and advertising) they allowed into their local marketplace.

    Monopoly constraint of distribution and supply will always lead to prices (and profits) significantly above open market rates. Newspapers then built costly organizational structures commensurate with that stream of monopoly profits (think AT&T in the 1970's).

    Unfortunately the Internet came along and changed all the rules!

    ——
    The dynamics of content replication and distribution on the Internet destroys this artificial constraint of distribution and re-aligns advertising (and subscription) prices back down to competitive open market rates. The often heard complaint of Internet ad rates being "too low" is inverted…the real issue is that traditional ad rates have been artificially boosted for enough decades for participants to assume this represents the long-term norm.

    An individual reader now has access to essentially an infinite amount of content on any given topic or story. All those silos of isolated editorial content have been dumped into the giant Internet bucket. Once there, any given piece of content can be infinitely replicated and re-distributed to thousands of sites at zero marginal costs. This breaks the back of old media's monopoly control of distribution and supply.

    To paraphrase Nietzsche, "God is dead. God remains dead. And we have killed him with the Internet…"

    ——
    The core problem for the newspapers is that in a world of infinite supply, the ability to monetize the value in any piece of editorial content will be driven to zero…infinite supply pushes price levels to zero!

    What this implies is that no one can marshal enough market power to monetize the value of content in the face of such an infinite supply and such massively fragmented distribution. Pay-walls, lawsuits and ill conceived legislation won't allow the monopoly conditions to be re-constructed because only ONE VERSION each story has to leak out to start the cycle all over again.

    ——
    Another way to think about this is that once data becomes publicly visible on the Internet, its monetizable value rapidly dissipates to zero.

    This is at the core of why Google can extract $25B a year from the economy without creating ANY content…what they create is meta-data about content (which CAN be monetized)…and all that meta-data remains non-visible. Only the results of decisions based on that meta-data by their search and advertising platforms is made publicly visible.

    The lesson is that Google DOES NOT monetize other people's content…it monetizes its OWN meta-data. This is certainly one path to making the news profitable…not search per se…but various other approaches to the monetization of meta-data that's within the reach of publishers.

    So the exquisite irony is this:
    In the future, the only content that will have monetizable value is content that no one is ever allowed to read! (i.e. the meta-data)

    ——
    There are certainly ways to make online news profitable…and many of us are working to develop such approaches…but I can assure you they don't involve inventing a "faster horse"…

    Dale Harrison
    dale.harrison@inforda.com

  67. Dean Wormer Friday, May 8, 2009

    This is very typical old media thinking: New media is killing my business by being parsitic and I still want to hold on to my old gatekeeper status and I very much resent you for taking over that position.

    Jim, how many Forbes subs for your old print product would you have if you stopped all of your direct mail drops? I don't hear you blaming the USPS for making money off the readers they charge to recruit for you. The only reason you don't is becuase they don't compete for ad dollars.

    Distibution buddy. Your brand only gets you so far. For the rest you have pay for that very expensive last mile. Google's massive infrastucture is paving the way for that new distribution for your future survival. You need to get used to that model.

  68. It's people like you who are killing printed media. You need to understand that the only way for content producers to survive in this new era is to find a new business model. The one you have been living off all this time is completely obsolete and provides little or no vale to the consumer.

    It is very scary that people in such position as yours thinks this way. Things must change, and they must change fast. People in the media need to step down their comfortable pedestals and start rethinking their businesses and how they can offer real value to the new digital consumer.

  69. Wah. Wah. Wah.

    Seriously. You are complaining about democracy here. Now that the world and his dog can write to the masses, you moan about lack of visibility? You don't HAVE to buy google keywords. You don't HAVE to buy TV ads either. You have to accept then that the competition can use other mediums, and DEAL WITH IT!

    Google do not violate fair use. They link to web pages. Would you rather there be no links to webpages? No, but you just want yourself and your old media buddies to have preferential treatment!

    "With less content online there will less activity online, and with that reduction of overall activity there will be fewer searches."
    You really think that old media is a proportionate amount of internet search? You think the internet is going to become some big void that nobody uses any more just because print sites are dead? Excuse me while I have a good belly laugh at your expense.

    Oh, and I bet you'd include this in your "professional writing", wouldn't you. Professional trolling more like. Don't moan about the internet to the internet. Even you must know something about targeting your audience.

  70. I found this article through google news and link chasing from there.

    IRONIC!

    What is a "Forbes" anyways? Sounds like something my Gpa might know about…..

  71. It's funny how people come out with such anger and acid in their tone when someone calmly addresses a real issue. Google's CEO, Schmidt readily addresses these issues in debates and forums. He's the one who said that the internet is a sewer right now. Searching can be a real pain to swim through all of the s^%$ before getting to the content produced by a professional journalist.

    Some of these posts remind me of the napster "I want everything for free!" crowd that readily stole content from artists. Publishers pay wages, health insurance, software, hardware, 401k matches etc… to people who produce all of the content. Clearly a discussion of packaging and distribution should at least occur.

    The high debate of ninnies attacking people as "grand pa's" for the assumed lesser technical knowledge is tiresome and sophomoric.. This type of attack is pointless and does nothing to advance everyone's desire to get good information in a timely fashion by people who are paid fairly for both producing and distributing it.

  72. This is utterly ridiculous. Jim, with all that traffic that Google drove to Forbes.com, I suppose you didn't make any money off that – right? Didn't you arbitrage the Google traffic in order to sell anymore ads to advertisers? Maybe Google should get a cut of that revenue too….

  73. Reg Berkeley Friday, June 12, 2009

    Interesting to see how much market share Bing will capture.

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