Author Archives: cemsertoglu

Etohum Presentation on VC

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On Saturday, I presented an introduction to venture capital at Etohum's Entrpreneurship Camp.  It was fun for me and I hope the attendees found it useful.  I was a bit concerned that I did not answer all the questions to the satisfaction of the crowd, due to time limitations.  I was also a bit disappointed in my ability to answer the questions using proper Turkish – something I strived for – and I think largely accomplished – in the main presentation.  It's difficult for me to deal with industry jargon in Turkish, because it feels a bit artificial and also because I don't necessarily use it in my day to day dealings.  It's easier to fall back on English.

The presentation was streamed live, and I understand Etohum will make it available as a video online soon.

Following the presentation, I came across an article in Entrepreneur magazine titled "4 Common VC Myths".  Even though I might not agree with all the points, especially the attempt at generalizing in the first point, I think it's a good intro for those who may have had their questions go unanswered on Staurday.

Twitter Spawning 50K Apps

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By now it's obvious that much of Twitter's value comes from its platform characteristics.  I can not think of another company that better embodies the spirit of connectedness in 2009.  But, hearing that 50,000 registered applications to date have been built using Twitter APIs, is still mindboggling.

It's also the evidence of Twitter's openness that powers its growth.

Twitter & Google Starting to Date?

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Googtw After yesterday's announcement of Yahoo intergating wih Facebook Connect, comes the news of Google and Twitter joining forces to allow Twitter integration with Google's Friend Connect.

John Battalle reads this as "Twitter, as in Not Facebook". On the opposite side, Marshall Kirkpatrick's take on it is "just like Yahoo bowed to Facebook, Google is bowing to Twitter".

I think I have a different view of this.  Despite the timing of both transactions, they represent different strategies to me.  Yahoo's move was a bow to Facebook, in favor of its users and the utility they extract from Yahoo, but eroding a strategic advantage Yahoo may have pursued through its massive reach.

Google's move, on the other hand, is less about bowing to Twitter.  Twitter knows surprisingly little about its users, whereas Google knows a ton – thorough clickstreams, search behavior and Gmail.  In fact, I'd say Google still owns a much larger chunk of the social graph than Twitter.  What Twitter is great at is realtime and declared interests.  And it's growing super fast.

This move by Google and Twitter makes me suspect even more my prediction yesterday.  This alliance will allow Google to observe how Twitter helps its users and evaluate Twitter as a potential acquisiton target.  It will also help Google to preserve some ground against Facebook, who has now clearly become the only contender to Google for ownership of the identity layer of the internet.

Facebook Eliminates One Rival in the Race for Social Graph Ownership

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Rocky_victory Today's announcement that Yahoo is integrating into Facebook Connect must have been accompanied with the sound of champagne bottles popping over at Facebook's headquarters.  It's a big victory for Facebook as it advances towards ownership of the identity layer of the internet.

To be honest, I am a bit puzzled at the early concession by Yahoo.  I am fuly convinced that by now Yahoo sees itself as a media company.  It's obvious with its concentration on content.  But, it also has an enormous amount of data on users and, through Yahoo Mail and Yahoo Groups, a nice chunk of the social graph.  And I would have expected Yahoo to try to extract some value out of that.

What's weird is that Mashable is calling this:

"…a no-brainer for Yahoo, who has been trying for years to make its services more social on its own. Now, they’ll start to see some of the benefits that smaller publishers have seen from Facebook Connect (more comments, extra traffic from Facebook, etc.) on a massive scale."

That is ridiculous.  Yahoo is not a small publisher.  It's one of the first and greatest destinations on the internet.  It's got as much traffic as Facebook and more members (500m vs Facebook's 350m).  Why is Yahoo doing this?  And isn't it ironic that the announcement is coming from Jim Stoneham, who's responsible for Yahoo communities?

Om agrees with me and sees Facebook as the big winner and Yahoo as the big loser here, and compares this move to Yahoo's deal with Google in terms of magnitude.  I think this is actually a bigger deal. In search, Yahoo lost to Google's technology.  It did not have much chance against Google.  Whereas in this case, Yahoo's still got a ton of data (groups data, mail-related social graph, hotjobs-driven professional information, flickr's social graph, etc.) to be a contender in the identity layer game.

I expect the next move from Google.  Facebook's got a lot of momentum and Google can not watch this passively. I'd predicted Twitter being bought in 2009.  It was not.  2010 maybe?

Sanalika

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Yesterday I blogged about my surprise upon seeing the Turkish virtual world Sanalika on Google's fastest rising list for 2009.  I further commented that "it has not made much of an impact in the Turkish internet scene so far".

I have since been contacted by a few friends in the Turkish gaming community who informed me that in facti Sanalika is a strong contender and that Alexa does not fairly represent Sanalika's traffic because of its flash-based site.  I stand corrected.

Turks on Google 2009: Sahadan and Sanalika?

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Right after my earlier post today on top search terms of 2009, I saw that Google had just released their Zeitgeist 2009.  While it's difficult to do an apples-to-apples comparison with Yahoo and Bing, the Fastest Rising List gives a taste:

  1. michael jackson
  2. facebook
  3. tuenti
  4. twitter
  5. sanalika
  6. new moon
  7. lady gaga
  8. windows 7
  9. dantri.com.vn
  10. torpedo gratis

And, yes, MJ tops this list, too! 🙂

However, what piqued my interest the most in Google's Zeitgeist this year are the Turkish entries, namely:

Sanalika, #5 in Fastest Rising

and

Sahadan, #4 in Fastest Rising in Sports.

Mind you, these are Global lists…

Sahadan is a Turkish sports news website, and to me, it's the less surprising of the two.  It's a solid property, a long-time resident of the Turkish Alexa 100, and given the level of interest in football in Turkey, a top Turkish site is not a far-fetched entry in the Google list.  Also notable is the fact that it's ranked above Livescore.

Sanalika, however,is a different story.  Ranking 375th in Alexa's Turkey rankings, it's a virtual world similar to IMVU or Popmundo. It has not made much of an impact in the Turkish internet scene so far, so I had to doublecheck when I saw its name on the Google list.

I still suspect Sanalika's inclusion on the list may be a quirk of the methodology used.  Curious…

Also, note KralOyun, a Turkish game portal, #6 in the Fastest Falling list.

All in all, Turks are showing their strong online presence as we've noted before.

UPDATE: The Sanalika saga continues with comments from Arda on TC Europe and Robin on TC.

Yahoo vs Bing Search Terms

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In the last couple of days, both Bing and Yahoo announced their top search terms for 2010.  Here they are:

For Yahoo:

  1. Michael Jackson
  2. Twilight
  3. WWE
  4. Megan Fox
  5. Britney Spears
  6. Naruto
  7. American Idol
  8. Kim Kardashian
  9. NASCAR
  10. Runescape

And, Bing:

  1. Michael Jackson
  2. Twitter
  3. Swine Flu
  4. Stock Market
  5. Farrah Fawcett
  6. Patrick Swayze
  7. Cash for Clunkers
  8. Jon and Kate Gosselin
  9. Billy Mays
  10. Jaycee Dugard

While it's not really surprising that MJ topped both lists, I am blown away by how dissimilar the two lists are.  Jackson is the ONLY common searched topic on the two search engines.  Venture Beat has an explanation:

Perhaps that’s not surprising — Bing is a much newer service, and
probably appealed to a more tech-aware audience. Yahoo, on the other
hand, reaches more users
(though it plans to replace its underlying search technology with
Bing), and its list skews even more heavily towards celebrities and pop
culture.

But I don't buy it.  Bing and Yahoo are both very mainstream search engines.  I could expect a difference of this magnitude on Powerset, Hakia or Wolfram Alpha, but the difference leads me to suspect that maybe there is a difference in methodologies.

I am looking forward to Google's Yearend Zeitgeist to see how that compares.

Foxes are Supposed to be Smart

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Fox I've been meaning to write about the News Corp – Microsoft deal rumours of which have been afloat for a few days, but lots of traveling and two events got in the way.  The deal involves MSFT paying News Corp to block Google from accessing its content and having it exclusively indexed by Bing.

My first reaction to this is that it won't work.  I beleive that information wants to be free and we see versions of that play out all over the web. I am all for creative monetization of attention, but gaming the system with biz dev deals does not seem to me the smart way to go about it.

One area that this "shift to free" has worked extremely well is news.  There has been much said and written on how the web is killing journalism and that the news room is going to die because of the web.  While many print media outlets are being hurt by the reduction in friction in news publishing, I think the casualties have not hurt the quality of the news we consume.  If you look at the example of the reporting the blogosphere (especially Arrington) has done of the recent Scamville issue, and compare it with NYT's coverage of it (as Fake Steve Jobs did), you can see how less friction has led to better news in some cases.

In any case, my big issue with this deal is less the economics of attention but the fact that this type of one-on-one agreement for exculsivity is just unnecessary friction.  There is no value being created for the ultimate consumer of news.  The consumer has so far voted with her clicks that she's found the way Google has directed her attention to news more valuable than the way Microsoft has.  Now MSFT and Murdoch are forcing her to either go to two sources for her searches, or switch to what she feels is a lesser search engine.

Now, I also think this is something Google has had coming. In its decisions regarding the economics of attention, Google decided on a black box approach.  Albert Wenger has written a smart post on this issue: 

One of the reasons that Craigslist is so hard to attack is that Craig has chosen to the give the bulk of the benefits to the network itself (as “consumer surplus”)
by operating most of Craigslist for free.  Google made a different
choice, which is to keep a ton of the economics for themselves (and
often in a non-transparent manner, i.e. it’s unclear how much of the
economics Google takes).  That will eventually create openings for
others based on a willingness to share the economics differently.

Microsoft took a first step into that direction with the cash back
for shopping.  A deal with news organizations would simply be a further
step in that direction.  It is therefore not clear that Google is maximizing long term value by hanging on to as much of the profit as they are.  That is the real heart of the ongoing conflict over news indexing.

As the attention economics gets more and more streamlined, we will see similar attempts at biz-dev'ing by incumbents.  Most attempts will be unnovation (to borrow Umair's term), and will not lead to any disruption.  The exciting developments will focus on increasing value.  I try to keep focused on those.