October 18th, 2007 by john andrews
October 15th, 2007 by john andrews
The “honeymoon” is the initial period during which much is forgiven. The situation is new, overreaction is dangerous, and a decision was already made to “try it and see how it goes“. You aren’t usually thrust into a honeymoon — you decide to go there: you manage the risk. The web, from an SEO perspective, has been one big honeymoon. Is the honeymoon almost over?
There are many indications that the honeymoon for webmarketers has been fabulous but is finite, and it may be time to start planning the return to reality. Competition is heating up, and as I suggested in “Here Come The Domainers“, there is plenty of room topside for more competition. Post-deregulation domain prices are correcting, as the secondary market takes hold. SEO services are still hawked as “task packages” even though SEO is a process, but buyers are getting smarter. We have one search engine, and that entity has taken over almost half of the online advertising market it helped create. As Google exerts some of that power, we’re going to enjoy fewer freedoms.
One of the big areas to watch is the web development space. Most immediately, I’m seeing domainers stepping into development, and they have a lot to learn. Web development has advanced well beyond the HTML and CSS of domainer world, with frameworks and platforms evolving at breakneck speed behind the scenes. As is the case in SEO, what you read on the web does not represent state of the art or even close. Open source CMSs may look good, but they represent nothing more than a framework to adopt, often without adequate best-practice nor robust community support. Popular support is not the same as robust support. If you don’t believe me, ask how many opensource CMS adopters have read the roadmaps for the apps they adopted. Ask how many of those roadmaps acknowledge a “complete re-write” is in the near future. Too many. Can you afford to adopt a framework that is scheduled for a complete rewrite? Think of the developers… are they concerned with the current release or even the nightlies, or are they focused on the next great re-write?
I doubt very much the venture and private equity groups forming around domain portfolios are ready to swallow the salaries demanded by the capable PHP, database, and web app dev people (if they could even get heir attention). Those of us involved in web technologies have encountered those problems for years now. A hundred grand doesn’t attract who you need any more. Do domainers have the stomach to carry high-salaried technologists who are more capable of chasing the same opportunities as a technologist that they are chasing as a business? Equity is not interesting to most of the really capable people, and when equity does motivate, I find the guy evaluating the equity opportunity knows more about the web and web development than the founders, their investors, or the leads on the venture. Honestly, they are not looking so much at the equity offer, but the likelihood of their taking over the entire project or a significant portion down the road due to their virtual control over it. That does happen, just as it happens with the IP lawyers and financiers. To really succeed on the web today you need more than youthful passion and obligation-free creativity. You need wisdom, and like the really good diamonds on display in the jewelry store, wisdom’s price tag “ask for price”.
Just yesterday an obscure blogger Earlier this month Aaron Wall wrote this:
A few weeks back I made a post about the book being a dying format, and in that post I have a Google book snippet. Within a week that snippet was broken. I had a Google CPA ad integrated into one of my major websites and the ad went away, breaking 10% of a large site and making it look like spam. Even some of the services that are not broke will likely be drastically different in a few years. Google maps is really open because they need marketshare, but after they become the clear market leader will they stay fairly open? How long until we have ads in everything? A good webmaster service that would be exceptionally useful is something that scours websites and looks for broken stuff.
Trusting Google for part of your page content and user experience? What does Google care if it fails to perform? Google maps has one of the most risky terms of service of any out there, yet young technologists forged ahead developing apps around it. They had to. But not to secure a defensible business. They did it to secure their tech positions. Now what will they do? Pitch you on developing Google maps applications using their leet skills? Are you prepared to evaluate and manage the risk associated with that Google Terms of Service which allows Google to shut you down at any time, for any reason, with no warning? the recent acquisiton of Navtech by Nokia should shake some boots. What happens to Google maps now? Or perhaps more clairvoyantly, when will Google acquire Nokia to secure navteq *and* the Gphone? Maybe it doesn’t matter for your gardening website, but if you’re Zillow, or an online yellow pages, this is quite significant.
There are plenty of signs. If you were registering domains back when they were $150 each you probably remember how stupid it seemed to pick the “authentication via email” option at the registrar. You were warned in great detail that email-based-auth was not secure, very risky, and should not be selected. Yet, what other choice did we have? It was far to difficult to manage public/private key encryption back then, and other alternatives we risky for other reasons. So in the end, virtually everyone accepted email-based-auth as the gold standard for domain registrations. And now? Because the whole system is based on an insecure protocol (email based authentication), criminals are stealing domains. The honeymoon that granted us freedom to actually choose a known-to-be-insecure option simply out of convenience, is coming to a close.
I think the honeymoon is almost over, but I also think we’re in for a wave of profit taking by the web technology people. Investors, builders, web real estate developers, and even consumers will yield to the technologists as they advance the underlying web infrastructure beyond even the rather complex levels it is at now, to levels well out of reach of most current web publishers. Innovation will get more and more expensive, and as the rest follow each other under Google’s umbrella, that innovation will yield more and more significant dividends.
Call it a bubble or call it a gold rush or a wave or trend, but the risk is increasing with that growth. Remember the old story about the guy who moved to San Francisco in 1849 to sell shovels? As we notice the new web business model evolving around a few core infrastructure players, and everyone shouts “ignore the little man behind the curtain“, who dares be Dorothy?
October 11th, 2007 by john andrews
Warning: Sometimes a blog post is less an essay than stream of consciousness… and some people may get headaches from wading through such a post (see the first comment – sorry!). The rest of you have been warned. By the way, according to the wiki, “stream of consciousness” was first defined by William James, the brother of Henry James, my favorite author during my college days. William James grew up in NYC. I grew up 6 miles or so outside NYC. William James lived in the Astor house… and my family has some connections to the Astors. Funny that, eh?
If you are in SEO or SEM, a domainer or an advertiser or a big brand, no argument the future looks bright, but is is also tumultuous. Who controls the commercial future more, the domainers, the marketers, the market (users) or the search engines like Google?
The brands are the ones who spend the most on advertising, and those same brands are the ones who will eventually recognize that perfect-match domains are worth $200,000 or more. The budget-minded advertisers are buying traffic more than branding, which they can value with metrics and the buying of which they can adjust practically in real time. Two very different “markets” for the same PPC spend, and look at how they are currently bidding against each other. That can’t last (?) nor can the practically real-time management of that spend (made possible by the benevolence of the search engine/ppc provider). That can’t last either (?)
The SEO and SEM move the market, which does whatever it has been moved to do (direct traffic, search traffic, supportive cooperative promotion, etc). The SEM uses tools like PPC, while the SEO approaches the issue from a Judo-like perspective, influencing the search engine to influence the users for them. Of course they cross-over. They have to cross over.
What about domainers? They own the opportunity that exists outside of the search-controlled traffic, so obviously the future of branding involves domainers. Domainers feed a little off of search, and a little more off of SEM (SEM highlights the value of the perfect match domain, and promotions drive type in traffic to some extent). But aside from investment, the biggest influence they seem to have right now is in the traffic arena. They funnel a huge amount of advertising traffic. At the ad network’s discretion.
So in the end, who is in control? What’s the end game look like?
I think domainers recognize that they wield less influence as domainers than they do as publishers. Hence the move away from parked pages to a focus on development, which is fueled by many other factors (many of which are indirectly fueled by the same core issues of domains as advertising venues). SEM in my view has always been a tactical job, at the whim of advertising networks. SEM provides the man power and tools to utilize the ad networks efficiently, and manage the market in ways complimentary to that deployment of the advertising networks. No ad networks and SEM is “social media” and squarely in the realm of Public Relations and Advertising.
More complex tools and more need for ad networks means increasing sophistication of SEM (and increasing value added by SEM practitioners). And SEO? It’s all about search. As long as search engines are free and drive traffic, SEO will rule as much as that search-driven traffic rules. If you don’t need search referrals, you don’t need SEO.
It seems the user is in charge of the end game, no?
If users like search, SEO and SEM rule and we can expect some big changes in the way brands are competing with arbiters and others buying traffic from search engines. Domainers reap the rewards of their investments as brands buy domains, but not much reward from traffic except at the discretion of the ad networks. I doubt browser makers will continue to permit natural (type-in) traffic to find its way to the generic domains like it does now. If domainers build their own ad networks, they play traffic cop and optimize. If there’s enough traffic, will we see DNO’s (domain network optimizers) shaping the traffic funnels for optimal profits? Sure we will. The persuasion marketing people will be all over that.
If users find domains to be better than search, which would probably require a substantial adoption of good, generic and perfect-match domain names (“brands”), the publishers win the game. If YourFavoriteYellowPages became the perfect pseudo-search solution to satisfying Internet users involved in commercial transactions, who needs a search engine? Who needs more than ONE perfectly branded domain? If Google went all-paid, and users were happy, then SEO goes away, SEM becomes Advertising and PR, and domains are either everything (the brand) or a small piece (listed in the directory as a destination).
And when that happens, we shall see a renewed interest in FREE SEARCH, as people get tired of reading what MyFavoriteYellowPages says or they get tired of the way the Domain Network Optimizers keep funneling them to FriendFinder or ClassMates.com or other BigBrands. And the reason the search experience makes them happy? Because through FREE search, they find www.johnon.com and all the other “publications” that are new, fresh, interesting, or otherwise “refreshing”. When that happens, I suppose I’ll put ads onto johnon.com to try and make some pocket money.
Huh. The more things change, the more things stay the same.
This morning’s “Meet the Registrar” session demonstrated the importance of the registrar in domain asset management. We all know this, and have been aware, but have we been truly aware? As domains increase in value, they become more valuable than money, yet how many are “stored” at registrars where security is not exactly top priority?
There are several domains at auction tomorrow over a million dollars. Many in the high hundreds of thousands. A digital bit in a database, with a value so high. Obviously there is a burgeoning market for stolen domains. A domain gets stolen away and then moved around and then sold on the private market, where the new owner may eventually be informed that it was indeed ms-appropriated. How many of us have insurance for our domain assets? Right. So what happens in this case? Someone loses a lot of money.
And the registrar is the middle man carrying much of the burden of restoring peace, and yet how many of you know your registrar as well as your bank officer? If your registrar receives a request to transfer your domain away this coming Sunday morning at 4:21 am your time, will they call your cell phone to check with you, or simply let it go?
Every registrar says the same thing – never use a free email address. “I can hack an AOL email account in 10 minutes” said one of the registrar reps here, AT THE PODIUM. Wow. There are programs out there mining the WHOIS database of email addresses that are expired” – so those domains can be stolen away. Believe it. “If your email is expired for a week and you have a god domain name, they will take it away within just a week or two”. Make sure the email you use for WHOIS is not on the registered domain. That makes it much easier for the hijackers to steal the domain.
Moniker notes that their domains are always locked unless they are in transfer. Why else would anyone ever want a domain unlocked? Moniker allows you to make changes, updates, etc without ever “unlocking” the domain, and wonder why other registrars allow domains to be left in the “unlocked” state when they have not been put into transfer.
TRAFFIC is run by the World Association of Domain Name Developers, and the WADND board of advisors (made up of big-time domainers) has developed a set of criteria for registrars, presented as a WADND “Seal of Approval”. If they meet these strict requirements for domain asset management (which addresses all of the above, plus more to ensure domain registrants are well positioned to not only secure their domain assets but safely manage them), the registrar can show they have that Seal of Approval. So far, 4 registrars have received the Seal of Approval: Moniker, Fabulous, DirectNic, and TuCows. GoDaddy was here this morning, saying they meet the requirements but don’t have the seal of approval. Maybe that’s true, but it didn’t sound very convincing.
Some questions from the audience:
Q: Why isn’t privacy free? Good question. GoDaddy didn’t say anything, but Moniker says they charge a small fee to cover internal management and handling of requests through the toll free number. Another registrar noted that they bundle free privacy with 5 domain registrations at one time, for example.
Q; For bulk transfers, why can’t the registrar send EP codes in bulk? Moniker answered that they do indeed send EPP codes in bulk for bulk transfers. I can imagine this is a balance issue, considering security and convenience.
Q: Do you automatically park a newly registered domain and keep the profits? GoDaddy says they do, and you can always change the DNS if you want. Moniker stresses again that you should have a relationship with your registrar, and via that relationship you should be informed of your parking options and the best way to park is to put it into the parking service. Another registrar (I wish he would re-state his registrar… was it redneck?) says they give a new registrant 3 days to do something with the DNS, and then if it lies dead they park it themselves.
Q: Can you all comment on how some registrars seem to make it difficult to transfer domains away? Yahoo! was cited as an example of a registrar that seems to work hard to prevent domain owners from transferring domains away from Yahoo! Moniker notes that some registrars put 60 day hold if a change is made to the admin contact, suggesting it is for security reasons, but it’s a registrar-specific policy and not required. The sense I got when Moniker said this is that GoDaddy has this 60 day policy because it is more profitable for them to lock up a domain that is about to be transferred. That practically insures an extra year of registration at GoDaddy, and probably also keeps a lot of domains at GoDaddy.