“Openness is the yin to Jerry Yang’s Yahoo”

Yahoo Reaches Out For Ad Partners

By Jessica Guynn, Los Angeles Times Staff Writer

September 13, 2007

The
search firm’s deal with Bebo is the latest in its push to sell ads beyond its
own sites.
Openness is the yin to Jerry Yang’s Yahoo. For its first
decade, Yahoo Inc. grew by attracting more and more people to its
stable of websites. Now, with its co-founder and new chief executive at
the helm, it’s reaching out to find advertising opportunities elsewhere
on the Web.

Yahoo and the other major portals are now all working strategies to place ad
inventory on the entire web, not just within their own domains.  Their
short-term focus appears to be paying lots of money to sites like Bebo in order to “buy” the right
to place ad units.  But doesn’t that seem like an expensive, non-scalable way to go in the long run?

I’d like to think that the KickApps platform presents a
much more cost effective, long-term model for the way Yahoo (and other portals) might “earn” real
estate on 3^rd party websites—by providing those sites a range of
media functionality and, in turn, helping them build incremental page
impressions.

In an earlier blog I described all this as an “Open Portal” strategy, the idea
being that portals need to open up (distribute) their content and functionality
to web publishers if they wish to effectively compete for advertising real estate off their domains.

I’ll repeat my favorite analogy:  Think of the way NBC
earns the right to insert ads on
3^rd party television stations by providing them television shows.
Imagine if NBC provided only ads to television stations (e.g. no television
shows).  Clearly the “adsense model” would not work for television networks and
it won’t work indefinitely on the Web.  And so it won’t be long before Google (and others) begin to think about packaging hosted applications with their ad programs
to earn publisher loyalty.   In a nutshell, that’s what KickApps is all about.

Call it “cloud computing” if you like…

I’ve used the term “Open Portal” to describe  what I believe to be an inevitable transformation of the web portal business to a model which enables the syndication of programming (both hosted software and traditional content) to 3rd party web publishers.  For Yahoo, MSN, AOL, Google or Ask, there are far more incremental impressions (and ad revenue) to be had distributing user experiences outside their four walls then by building new ones within their respective domains.

It’s hard to say who among the the major players will be the first to fully embrace an Open Portal model, but it’s coming.   And it must be important because I just read about what’s next in the NYTimes.   They may call it “Mash-Ups” and “Cloud Computing”, but a rose by any other name…

Anne Eisenberg NYT 9-2-07:  “Now
mash-ups are poised to hit the mainstream, and to spread well beyond music. Yahoo,
I.B.M., Microsoft and others are creating systems to let ordinary people who’ve never been near a
Java class create useful computer applications by combining, or “mashing up,”
different online information sources.”

John Markov NYT 9-3-07:  “This week, it plans to turn that strategy upside down, making available free software that connects its Windows operating system to software services delivered on the
Internet, a practice increasingly referred to as “cloud” computing. The initiative is part of an effort to connect Windows more seamlessly to a growing array of Internet services.”

Old schoolers like NBC, CBS and ABC have had the syndication model figured out for a long time (let’s leave aside the issue of ITunes distribution for the moment), and AOL finally did a Gorbachev with their own walls.  But there’s still a large gap between clouds, pipes and mash-ups…and an Open Portal architecture that would allow the big players an opportunity to earn real estate across the entire internet by partnering with willing web publishers.

Hosted Applications, Google Apps, etc

 

KickApps was designed from the ground up to deliver a suite of hosted applications that developers can call on-demand.  Although different in scope, platforms like Google Apps have a similar agenda.  Over time the promise for developers is a limitless array of hosted tools and experiences that deploy quickly in a cost-effective manner.

KickApps can be different things for web developers with very different needs.  For example, some developers may begin with a few Video Players and later add Widgets and Social Networking.  Others may begin with a UGC contest and later integrate Video Players that present playlists of their own editorial content.

Video Players: KickApps web developers can build any number of individually styled and programmable video players for instant deployment on any web page, all supported by a web accessible media management system.

Widgets:  KickApps web developers can build and deploy any number of individually styled and programmable widgets to display and syndicate their own video, photo or audio content.  Widgets also  deploy and syndicate user contributed content.

UGC:  KickApps provides an easily deployable, highly scalable UGC application that includes, video, photo and audio uploads, transcoding, tagging, search, storage, CDN, flagging, media moderation, video blogs, webcam functionality, video-enabled message boards and member-to-member video messaging.

Social Networking: The KickApps social networking application includes customizable personal pages, personal media management, personal widgets, integrated webcams, RSS, IM alerts, comment management, custom settings, customizable wallpaper, themes, and member management tools.

Context Is King

With KickApps 2.0 now live I figure it’s about time to post some of the blog entries that I’ve been scribbling in my notebook the past few months. I’ve got a lot of catching up to do, but with the final episode of Rome beckoning on our DVR my wife says I have to keep it brief and type fast…

I’ve received a lot of enthusiastic feedback following my talk at the MIT Enterprise Forum, but the question on the mind of most publishers seems to be: how can they compete effectively with the likes of YouTube and MySpace for audience and revenue? It’s my favorite question because the answer is easy–it’s not their job to compete with the big general purpose portals! Publishers have an asset more valuable than low CPM traffic, namely an identifiable audience attracted to specific editorial content. To thrive, publishers have to convert their audiences into communities, and the most effective way to do that is to encourage participation around every aspect of their content. In other words, when it comes to building community, context is king.

Publishers can transform their site experiences into something far more compelling by inviting visitors to bring their own opinions, media and friends to the party. The operative word is “party” because with that perspective publishers can begin to recognize that their role is as much party host (and door bouncer) as it is content provider. Great editorial content (e.g. videos, photos, text articles) is just the beginning of the user experience, not the end-all. As publishers embrace the concept of “openness” the purpose of editorial content increasingly will be to get the conversation started by encouraging user participation around specific topics.

But enabling user participation within the context of specific content websites requires a much more flexible and modular implementation than what you might find at general purpose portals like YouTube. User content (whether videos, photos, blogs, personal pages or forums) must live alongside editorial content, not on remote “community pages.” An editorial story about World Cup Soccer, for example, might be surrounded by UGC modules containing soccer-related blogs, forums, member lists and videos. As the distinction between editorial and UGC continues to blur, have no doubt that stand-alone “community pages” (or message boards that live apart from editorial content) will soon be tired vestiges of internet days gone by.

OPWs: The Making of An Open Portal Website

I initially invented the term "Open Portal" to describe how portals like Yahoo! or Ask might evolve a larger strategy to reach all that lies beyond their own destination sites.  But individual websites can take the same cue with surprisingly little effort. 

Open Portal Websites (OPWs) invite members to bring everything they are into the
website experience (friends, family, hobbies, thoughts, ideas, videos, photos, blogs) and invite them to take a piece of that experience with them when they leave (widgets, feeds, RSS).  It’s not just about reaching people with effective SEO and it goes beyond creating programming for your own URL.  The goal of an OPW is to program the entire web!  And your audience should do most of the hard work for you.

OPWs are living, breathing organisms that swell and grow with user "stuff"; and like living things their children help them duplicate and grow virally as they wander off and connect to other people and places.

To enable major media and other websites to transform their websites into Open Portal experiences,  platforms must provide user-generated content, social networking,
video messaging, multi-media discussion boards, widget building, video players and a
host of tools that invite meaningful user participation.  But enabling functionality is simply not enough. 

User features must be built upon media management, member
management, administration and reporting layers that support fast, safe, customizable deployments (a service-oriented architecture with easy to use UI objects and robust APIs).  It’s one thing to enable Open Portals, but it’s quite another for traditional media and niche websites to feel safe with all this “openness”.  Without management tools, abuse and offensive material will scare off major brands and advertisers.  So behind the scenes, we must remember to include a measure of both form and structure.

A final thought…  Windows transformed DOS by allowing application developers an easy way to innovate without the necessity of building the same structures (print, file management) over and over again.  It’s time for an analogous development for web developers.  A kind of "internet operating system"…a platform that provides developers with more than a language…instead, it will provide a wide range of business components, hosting and services…callable at any time, by anyone at little or no cost.

Check back soon…there’s much more to talk about!

Open Portals, Anti-Portals and the Wholesale Web

Prediction

Portals like AOL, MSN, Yahoo and Google
will soon generate more impressions and ad inventory by providing their programming
to third party websites then by serving retail traffic within their own
domains.

The idea of internet portals
morphing into "wholesalers" of programming to many thousands of "affiliates"
should not be surprising. Wholesale
distribution is the driver of nearly every major industry (from manufacturing
to major media), and the television and film industries have worked that way
for decades. NBC distributes its programming to loads of independent
affiliates, so why shouldn’t major web portals expand distribution beyond their
own web properties? And from the perspective of most webmasters looking
to invite user participation at their sites, programming complexity requires help from larger web players.

While portals like Yahoo and
Google may capture dominant market share relative to other websites, their
audiences are modest relative to the aggregate audience of niche websites
across the internet. The universe of websites has a very long-tail, and
soon it will be clear that earning real estate on those websites will be the
primary mission of every major portal. Open Portal or Anti-Portal may be the best ways to describe this new animal.

User-generated content plays a central role

Perhaps there’s nothing all that
radical about syndicating content on the web. Video distribution has become
fairly common, and there are a number of companies (like BrightCove and
thePlatform) making it easier for content aggregators. But the
syndication of traditional media is not enough to validate my outrageous prediction.
A portal platform designed only to distribute video files is just not that
interesting—the internet is by nature an interactive place. User
participation is the key ingredient driving consumer traffic and, in the
context of portals distributing programming to 3rd party websites,
any definition of programming that includes only traditional media content is far too narrow.

Context will drive the next
evolution of user-generated content and social networking (among other Web X.0
features), and that context will be expressed thru many thousands of
niche-oriented websites, from major media websites to local radio, high school
and family websites. Whether those
niches are primetime reality television show websites or high school URLs, the
winning solutions will blend premium and long-tail UGC within the many
sub-contexts of individual websites.

By way of example, Major League
Baseball will want to blend vintage footage of Babe Ruth on highest rated lists
at MLB.com with highest rated Little League videos uploaded by 14 year-old fans
and their parents. Or MLB.com will present
a list of junior girls soccer videos alongside a premium content story about
Mia Hamm. In any case, user
participation blended with premium content will soon define the total
experience within specific contexts and sub-contexts on many, many websites.  By the way, MLB also may also want to power, brand and distribute content to every Little League website in the country—enabling all these microsites is part of the challenge.

The only thing standing in the
way is the difficulty of web developers effectively building the kind of complex
backend infrastructure and media management necessary to support these
user-driven experiences.

So how might this fancy new portal platform work?

Imagine if a portal like Yahoo took
the initiative of providing any 3^rd party website open access to a
wide range of hosted programs (with both traditional content and user participation functionality). The Yahoo affiliate platform would invite webmasters
to browse for programming that improves their user experience, thus creating
incremental traffic and ad inventory for both Yahoo and their affiliate websites. Programming would include user-generated
content and social networking functionality, Flash video players, media-enabled
banner ads, online games, a selection of live events, short video programs and
everything else available from Yahoo’s existing "retail" verticals. All programming would be supported by a seamlessly integrated media management system, complete with administration,
transcoding, hosting, reporting and data mining services.

Widgets will no doubt be the fastest and most customizable way
for webmasters to implement Yahoo syndicated programming. But these
widgets will go beyond the skin-deep objects we’ve seen thus far (e.g. chat,
video blogging). That is, most of the functionality would present itself
to end-users at 3rd party website after they’ve clicked thru these deep widgets to
more full-featured page experiences (branded
to 3rd party websites, but "powered by Yahoo") with web services allowing customization and seamless integration of these
experiences on affiliate websites. The widgets themselves (whether Flash,
HTML and/or AJAX enabled) will be customizable by web developers with just a few clicks at Yahoo’s affiliate center.

Portal distribution platforms
will be even more ambitious than those provided by ASP trailblazers like
Salesforce.com. Think of them as fully
hosted tinker-toy sets for webmasters. Application
frameworks like Ruby on Rails provide a half-step in this direction—what I’m
describing is a fully hosted platform far more abstracted and non-technical
than any programming language. The
platforms, themselves, will be built on sophisticated, service oriented
architectures, and may make use of JBI and other powerful messaging
technologies. By contrast, deployment of hosted programming on affiliate websites will be trivial.

By elegantly blending
off-the-shelf, hosted programming with their own premium content and
personality, webmasters can quickly implement complete solutions with minimal
engineering support and cost. Implementation
of feature rich hosted programming will take hours, not months, and the only
price to affiliate websites will be sharing some ad inventory with their portal
provider—just as local television affiliates share ad inventory with the major
networks.

Impact on internet advertising

This portal syndication model
will have tremendous impact on internet advertising. In a very real sense Google’s Adsense program
is already embracing the concept of capturing real estate on third-party websites. The only difference is that Adsense is capturing real estate with advertising alone—zero programming! Imagine if NBC announced that there would be no Fall Lineup for its independent affiliates—just ads this season. How many of those stations would remain NBC affiliates? Zero is a safe assumption.

The implication is that soon as
other ad networks begin to level the technology playing field (which is
inevitable), Google will have to begin earning
that Adsense real estate by providing their affiliates with programming that makes sites more sticky and viral. In fact, the Google Apps program is a first step in that direction. No surprise to me. Google is, after all, a very smart
company.

Major media

Traditional web portals will not
be the only companies interested in distributing programming to third party
websites. Major media brands like MTV
and Sports Illustrated will discover that their brands are powerful enough to
live outside their own web domains in a more meaningful way. And the programming they provide third party websites will go far beyond traditional content, and will include hosted
services that enable deep user participation. For example, it’s easy to
imagine MTV providing a turnkey "Powered by MTV" hosted service that enables
every musician, record label and music-related website with user-generated
content functionality, live events and other programming. Similarly, it’s
easy to see why it will be compelling for SportsIllustrated.com to provide
every local Little League website their very own "Powered by SI" social
network.

The promise

My predictions are all very
self-serving, I’m ashamed to admit. My
company, KickApps Corporation, has set out to build the kind of platform I’ve
described in this blog entry. But there
will certainly be others, and that’s a good thing. The promise of Web X.0 requires that we
increasingly make building amazing user experiences as easy as it is to use
these experiences. The line between user
and web developer will continue to blur as surely as the line has blurred between
content creator and content viewer. Web developers that seek to fully empower their site visitors will need lots
of help from platform companies focused on making their jobs easier.

Context is Meaning

Everyone has a theory as to how MySpace became the dominant social networking destination.  Was it weak competitors?  Better technology?  Interface design?  Savvy grassroots marketing?  Timing and momentum?  Blind luck?  Maybe all those things had something to do with it, but I tend to think that MySpace took hold on the strength of its original purpose: bands, music and underground hip (and hot girls also had something to do with it, I’m sure).  In other words, MySpace provided an initial context through which their community took root and grew.

Since then dozens of new social communities have appeared, funded by tens of millions of dollars from the venture capital community eager to participate in this aspect of the Web 2.0 tsunami.  Some have more and better features, others more robust architectures, yet none of the new general purpose portals have taken significant market share from MySpace.  So, is it game over?

KickApps is premised on the assumption that the next wave of successful social networking (and user-generated content) communities will come from major media websites and other content providers that offer their audiences contextually specific reasons to aggregate.  It’s easy to imagine why very large communities will form overnight around specific cable networks, reality shows, talk shows, radio stations, newspapers, universities, religious groups, expatriate organizations, gaming enthusiasts, celebrities, extreme sports, etc, etc.  And it’s easy to see why advertisers will be willing to pay a meaningful cost per thousand for advertising within a community with knowable demographics and closely moderated content.

From a user perspective, uploading photos and videos to new, niche-oriented communities is not a significant barrier to entry—anyone under the age of 35 can handle that task in a matter of minutes.  But from a webmaster perspective, the harder barrier to entry is technology development.  This is especially true for major media properties that will require sophisticated media management, administration and reporting functionality to protect their brands (and advertisers) from pornography and other potentially offensive material.  Building a very basic application that accepts video uploads and displays them on a page is relatively easy.  But when time-to-market is a critical competitive issue, building all the tools necessary to moderate and customize a community experience is quite another story.

So we built the KickApps platform with an eye toward serving many thousands of websites, big and small, with a hosted, turnkey approach to implementing sophisticated community functionality.  Our emphasis is scalability and customization with a range of tools that allows websites to focus on creating premium content and tasks more relevant to their core competencies.  Our roadmap will increasingly enable features that provide additional branding, real-time reporting and the dynamic inclusion of premium content within pages served by our platform.  Our implementation paradigm of “Viral Widgets” will allow our affiliates to present contextually relevant user-generated and premium content with an ever-growing array of styles and flexible layouts, and our Affiliate Center will evolve into a data-mining dashboard, providing real-time information.

The KickApps “Open Portal” philosophy is about providing easy access to a range of hosted technologies that enhances the community experience within our affiliate websites.  More on the Open Portal concept in my next entry.

Eric Alterman, KickApps Founder & CEO

The idea of starting the company I now call KickApps Corporation came to me in the winter of 1995, the morning after an evening visit with my grandmother. Grandma Ann was about ninety years old at the time, and we had spent a long evening eating Chinese food (Chow Mein was her favorite) and talking about her life growing up in Lower Manhattan. We had had this conversation many times before, but this time I remembered to bring my video camera and was able to capture two hours of fascinating storytelling from a women that was nearly a full-grown adult at a time when “the iceman” delivered house-to-house from a horse-drawn carriage. According to Gram, electric refrigerators didn’t make it to her neighborhood until “long after the War” (I’m still not sure which war she was referring to).

Anyway, I went to sleep that night very pleased that I had finally videotaped my grandmother and woke up the next morning with the idea of building a company that invites people to share their video memories online. Timing is everything, of course, and in the pre-cable modem era no self-respecting venture firm would touch my idea with a ten foot pole. So I put “KnowHow Video” (that’s what I called it in those days) on the shelf and began building a series of venture-backed companies based on technologies I licensed from military contractors like ITT and Lockheed Martin (e.g. Meshnetworks, SkyCross). But I would periodically return to my video sharing idea (always my favorite), and eventually built an initial prototype at www.KnowItAllVideo.com.

KnowItAllVideo was around long before the world knew anything about social networking and user-generated video, and we continue to keep that website live in its original form, mainly for nostalgic reason. Although I must admit that it stung a little bit to see the birth and explosive growth of similar sites that followed KnowItAllVideo, building a destination website was never part of my entrepreneurial DNA. My vision was always to power every website with user-generated content and social networking functionality. So KickApps is a hosted platform company designed to do just that.

I write this blog on the eve of our public launch with high expectations. We have a talented and motivated team, supportive investors and a vision that we all believe in. My grandmother is gone now (she made it to ninety-nine!), but I know she would have been proud of what she inspired.