What I've Been up to...
I've been quite the juggler so far this week, so I thought I'd link to some of the stuff I've been up to.
Here's my latest BusinessWeek column. It talks about the erosion of local advertising amid newspapers and why we don't care enough that they're going away to, oh, say, subscribe. Further, I throw doubt on this whole idea that these local ads will flood online creating the next great market. Needless to say, it's created some controversy and push back. A dozen or so companies have written me to tell me they're indeed selling ads to local companies. I don't doubt it. My point is it's near impossible to build one huge-billion dollar business selling ads in local markets throughout the country. It's a bit like the push back I got on my software as a service column. Yeah, customers love it and you can get to $10 million-$50 million in revenues pretty easily. If that's the new end goal for venture backed startups the Valley is in trouble.
Meanwhile, I've also been busy deriding Sirius and actually defending Google over at TechCrunch. And below is the first installment of a four part series of interviews with the controversial Jimmy Wales, founder of Wikipedia. It's a longer clip than we usually run, but I found the stuff at the end about why Wikipedia doesn't put ads on its site particularly interesting. Enjoy!
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Can a single billion dollar business emerge selling what amounts to local ads, online? I'd agree this will be difficult, though I'm not sure this is impossible. It's true that, for now, most advertising online prefers to be niche organized, rather than geographically organized. But surely we will see some dramatic change, if in fact the newspapers collapse? One dramatic change (the collapse of the newspapers) seems likely to trigger another (a change in advertising patterns).
Creating a national market for local ads was what (http://www.donovandata.com/product_overview) Donovan Data Systems was able to achieve, starting in the 1960s, for radio, newspapers, magazines, etc, and now a large percentage of local ads are sold through DDSs databases.
Back in 2006 I spoke to the folks at DDS and I know they were, then, as skeptical as you are about whether anything similar can be achieved online. But still, it seems to me like a possible failure of the imagination if we believe that the newspapers are going to collapse, and we don't imagine what other changes to the status quo become inevitable from that point forward.
Posted by: Lawrence Krubner | February 18, 2009 at 05:12 PM