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Tech Tuesday, 9-8-11

Scott Thompson's picture

A weekly collection of the big news in digital media and technology

This week has been pretty much overshadowed by the terrible scenes of the last few days in London and some other UK cities.

Hitwise have published some stats on how traffic to Twitter has spiked as people turned to realtime social news to keep track of events and stay in touch with friends in the city. Meanwhile, there has been some speculation over the role BlackBerry's BBM service played; obviously its a leap to claim that social networking tools are responsible for the events (at least as much as claiming rolling 24 hour coverage on TV is responsible), but as Ofcom's Communications Market Report revealed last week, BlackBerry is the most popular smartphone among younger people.

Mobile

Smartphones and mobile internet usage were something of a theme for Ofcom's report; with 50% of 16-24 year olds now owning smartphones, they are the most likely to be smartphone users, accounting for 27% of all smartphone users. Apple's iPhone is the most popular platform for all other age groups, with a 32% share of the smartphone-owning population. But the BlackBerry's BBM messaging service (offering free messaging between BlackBerry users, over RIM's private and secure network) is a strong driver of platform preference among younger users.

Ofcom's report has plenty more statistics (over 300 pages), with some particularly interesting insights into smartphone users' relationships with their devices, and is a very useful resource for anyone with a need for UK media landscape statistics. It is available in full at their website.

(Speaking of Apple, for a moment today, their stock market value passed Exxon making them the world's most valuable company.)

Meanwhile, Google made something of a statement through a blog post last week on the topic of smartphone patents. Entitled "When patents attack Android" (a play on the title of a recent radio show), the post sets out to describe

…a hostile, organized campaign against Android by Microsoft, Oracle, Apple and other companies, waged through bogus patents.

The friction revolves around the issue of patents; a smartphone involves hundreds of thousands of technologies, many of which are protected by patents. Google, being a relatively late entrant to the mobile handset market (you could argue that it isn't actually a player in selling handsets), doesn't have the kind of patent portfolio that Nokia, Samsung or Apple have at their disposal. There is a complicated network of lawsuits between manufacturers, where a common resolution involves agreements to cross licence patents, using one as a defence against the other. Google's argument is that this network makes it difficult for open-source software such as Android to compete against an organised network of businesses – such as those whose sales are threatened by the rapid growth of Android as a competitor.

Digital TV

This week also saw the release of Virgin Media's Entertainment index, carrying some interesting insights into how users of the new TiVo-based TV set-top box are using the new platform.

25% of TV channel views did not come from the EPG (traditionally the only way a TV channels can be accessed), coming from other services such as "intelligent search". Looking at the popular search terms being used, its interesting to see that half of the top ten were outside of BARB's top 50 programmes by audience;

  1. The Apprentice
  2. Camelot
  3. Doctor Who
  4. House
  5. Glee
  6. EastEnders
  7. Dexter
  8. Casualty
  9. Desperate Housewives
  10. Fringe

This also echoes some of the findings from our research at SMG into how PVR adoption changes viewing habits, with second or third choice channels seeing a noticeable uplift in viewing.

Some other stats of note; 79% of all the TiVo set-top boxes were used to access an app and, on average, each box launched apps 4.5 times a week.

Looking across Virgin Media's entire TV subscriber base in the first half of the year (ie. not just TiVo users, but all cable TV customers), customers made 484 million On Demand views; a 19% increase on the same period of 2010. Last year saw a noticeable rise towards the end of the year (15% higher viewing over the last six months, with particularly high viewing in the last three months), indicating that Virgin Media is likely to be on track for a landmark one billion On Demand views in 2011.

Social Media

In the world of social media advertising, Facebook has now opened its advertising API, allowing anyone to build on it to build their own advertising systems, making the most of the technological opportunities to optimise advertising buying more efficiently across relevant target audiences. Our team has been using this technology for some time- speak to the SMG Facebook Advertising team for more information on how it can be used to make your investment work harder.

As social media grows, the "Web 2.0" buzzword is apparently on the decline – and due to die completely on the 1st October 2012. It might seem like an oddly specific date to attach to such a nebulous idea, but there is some logic behind it; analysis on search queries shows a steady decline in interest in Web 2.0

Search

In the world of search, this week Yahoo UK's search results switched to Bing. Yahoo's US search results have been powered by Microsoft's technology for some time following an agreement last year (in which Microsoft's technology would power Yahoo's search, while Yahoo would continue to sell advertising around search results on their site.)

Tech Tuesday, 2-8-11

Scott Thompson's picture

A weekly round-up of the news you need to know in digital media & technology

Social

Some new Twitter stats appeared on the official blog this week;

  • Over 200 million Tweets per day (up from 65 million a year ago.)
  • More than 1 million Twitter apps - up from 150,000 a year ago.
  • More than 600 employees- up from 250 12 months ago.

No doubt, the numbers were posted to add some context to the latest change in Twitters' advertising, as they continue to seek a business model to match the valuation I mentioned last week, with a change in the way their Promoted Tweets will be displayed. The new Twitter ads will increase a brands' visibility among their followers, as Promoted Tweets will now rise to the top of their followers' timelines.

This means that only users who have already chosen to follow the brands who are advertising will be affected; users can dismiss the Promoted Tweets with a single click (although why they would do so isn't clear, given that they will sink from view as quickly as any other tweet.) Twitter will be testing the new initiative with a number of US/Global brands.

Which means that UK brands won't be able to experiment just yet… although not for long, as Twitter's London office (which we have mentioned before) is expected to open soon, with agency talks apparently now underway.

Making the most of Twitter's new advertising is considering the way that your followers' interactions with brands affects the way that brand messages reach their friends and followers. Along these lines, some interesting social media marketing insights were published by Comscore, in a new paper on social media; "The Power of Like." One nice stat to come out of it is that for brands, "friends of fans" constitute an audience 34 times larger than "fans" alone.

In a Starbucks case study, its noted that not all of their 24 million fans will see Starbucks' updates on the site. But when those who do decide to interact with it, then it reaches their friends (at no cost to Starbucks.) Have a look at the paper for more information.

(At SMG, we have been looking at ways to understand the value of "likes", "comments" and other interactions. Be sure to have a look at that as well.)

Meanwhile, Facebook's London office is growing, as they move to a new 36,000 square foot office in Covent Garden. This week, Facebook launched "Facebook for Business", a new resource for Facebook advertisers aimed at small businesses, with tips on creating and managing pages and ads.

(If you're looking for help and advice in this area, then once you have checked out Facebook's new pages, you should also speak to our team.)

Gaming

Nintendo slashed the price of the handheld 3DS console by around a third (in Europe), giving 20 'classic' games to the console's early adopters (or "ambassadors", as Nintendo are calling them.)

A clue as to why might be revealed in an interview with the EA CEO. Consoles are now just 40% of the games industry. Ten years ago, they were 80%. Surely the rise of smartphones and mobile apps (a market dominated by games) is playing a big part. Today, devices like the iPhone and iPad are growing in number - and importance. Not only do they offer an alternative gaming platform, but they are also opening up new gaming opportunities for audiences who wouldn't typically be interested in buying a dedicated gaming device.

With low cost mobile games offering competition to high cost games for dedicated mobile platforms, the opportunities appearing for either branded games or in-game advertising are worth watching out for.

Mobile

With news that the iPhone 5 is now expected in October, developments in the mobile world is proving to be just as disruptive to related markets as they are to direct competitors.

But it isn't all smiles in the App world. Apple recently changed the way they are dealing with in-app purchases, tightening the rules around how publishers can offer their own payment mechanisms, sidestepping Apple's iTunes system (and the 30% cut that Apple take.) Some recent changes made to the Kindle application have removed the ability to purchase content from within the application completely. As Amazon explain;

In order to comply with recent policy changes by Apple, we've also removed the "Kindle Store" link from within the app that opened Safari and took you to the Kindle Store. You can still shop as you always have - just open Safari and go to www.amazon.com/kindlestore. If you want, you can bookmark that URL. Your Kindle books will be delivered automatically to your iPad, iPhone or iPod touch, just as before.

Over at Forrester, analysts at "Apps aren't the killer app" – in a blog post, they point out that just 7% of US and EU phone owners regularly download mobile applications, and only 11% of US phone owners have ever downloaded an application from a store or marketplace. (Forrester also cite a study from Pinch media — albeit from over 2 years ago — that found that 80% of free apps are never used again after the day they are first downloaded.) Forresters advice (which I would echo) is that for the publishers of many mobile applications, the need for an app is driven more by the technology than consumer insight; for many cases, a mobile-optimised website is a better solution to the problem than building a dedicated application.

However, its worth pointing out that those figures are looking at a total population –the smartphone-owing population is still a minority, but one that is growing at an incredible pace.

News from BBC Worldwide about the launch of their iPlayer app for iPad is probably one good example of an opportunity that would be hard to seize using a simple web-optimised site; a free application available in 11 markets (Austria, Belgium, France, Germany, Italy, Luxembourg, The Republic of Ireland, The Netherlands, Portugal, Spain and Switzerland) will offer BBC TV content for sale at €6.99 a month, €49.99 for annual subscription, with advertising running around free, sample content.

The app is positioned differently to the UK's iPad application, with eight genres of content available (News Specials & Documentaries; Entertainment; Drama; Comedy; Science & Nature; Family & Kids; Music & Culture and Lifestyle), as opposed to the catch-up model of the UK's app. In addition, the inter nation application will allow users to download content to watch offline- a feature not available in the UK app.

Video

BSkyB has broken the £1bn profit barrier. Apparently undistracted by the recent News Corp. manoeuvring, the latest financial report from Sky shows an excellent year, with a 23% growth in operating profit breaking the £1 billion mark.

Sky is also seeing growing numbers of customers taking "triple play" bundles (broadband, telephony and Sky TV), and there are now 3.8 million Sky+HD customers (up 30% year on year) — an interesting number to keep an eye on as Sky continue to work on their AdSmart technology.

The way online video and TV will develop is certainly of interest to anyone with an eye on the future of media. Digital TV Research are forecasting a growth of on-demand TV revenues to grow to $5.7 billion by 2016 — excluding revenues from sports, adult and subscription services. This is a rise of 58% compared with 2010, with growth expected to largely grow from cable TV.

ITV are also making moves towards the paid-for model, as revealed in their latest financial reports; CEO Adam Crozier noted that;

We plan to have a pay mechanism in place around the turn of the year so that we can test what viewers are willing to pay for, and we continue to work with our partners on YouView, which is on track for launch early next year.

A US survey of online video attitudes and consumption (sponsored by video publisher MetaCafe) has some interesting findings; 63% "can't live without" their PC/Laptop, and 32% say its their primary medium for entertainment. (This compares to 60% who say they "can't live without" television, and 44% who say it is their primary medium for entertainment.)

But among 18-34 male consumers, the picture is slightly different- although the PC is slightly more important, the perceived role of TV is clearly shifting, with only 28% saying it is their primary medium for entertainment.

Its worth noting that with 14% saying the same about games consoles games consoles - which is presumably used through the television - this may be as much a distortion of having to make a single choice in the survey as reflecting different values of respondents.

As well as these attitude findings, it has some interesting stats about platforms; 25% of respondents say that they are accessing the internet through a TV set (mainly through games consoles), with a further 23% saying that they don't presently, but are interested in doing so. Plenty more stats are available in the presentation, available as a PDF to download.

Top 5 things to know about Google+ 5) Google+ will be used differently to Facebook- so brands' role will be different

Scott Thompson's picture

The final part in a series of "Things to know about Google+". Catch up with part one, part two, part three and part four.

There are two things that make it tricky to evaluate Google+ at the moment;

  1. Its a social network, but invitation-only. The people on it are tech-obsessed early adopters. Once the service has been opened up and Google are promoting it outside the tech/media circles, this will change. So it can't be judged on the content/community.
  2. The software is incomplete; with Google billing it as a "technical field trial", and other statements and indications from the company about its future, it seems clear that there is more to Google's plans than Circles and Streams. (I set out a few examples of these 'networked services' in Part One

That said, by looking at what Google has revealed about their plans for the service and their other activities in related areas, we can make some reasonable assumptions about the benefits that Google+ will bring to users, and therefore the sort of people who will be using it. The most obvious audience consists of two related groups;

Existing Google users – not just people who use the search engine, but people who have set up profiles and create content on Blogger and YouTube, who have set up Google Reader and use it to share links, or are using Google Groups to stay in touch with particular interest-based communities.

Content creators and attention seekers; for anyone interested in building visibility in SEO (for example, bloggers, journalists and celebrities), Google+ will bring clear benefits. I mentioned in Part Two that Google has introduced authorship markup – technology that allows authors to identify themselves in their work online by linking it to a page that represents their online identity, which will then be promoted in relevant search listings performed by people who are 'connected' to the author, or people who have +1'd pages on their site.

How will Google+ be used?

Right now, the conversation seems to be dominated by talk of Google+ (in much the same way that for quite some time, the conversation on Twitter was dominated by the subject of Twitter.) At the moment, the profiles with the largest number of followers appear to be technology bloggers such as Robert Scoble and Pete Cashmore, who are bringing networks over from other communities (ie. Twitter.) A key indicator of when the platform has moved on will be when we start seeing mainstream celebrities bringing their followers over – which in turn will give more mainstream users a reason to migrate.

In this sense, it seems likely that public posts on Google+ will make it more closely resemble a blogging platform like Tumblr than a typical social networking site.

But on the other hand, the more 'social' side of Google+ seems designed to encourage more private discussion. The design of "circles" forces their use – Facebook and Twitter both have 'lists' functionality, but users can easily use either services without even knowing about them – let alone using them. On the other hand, every time you add a friend/contact in Google+, you are forced to choose one or more circles to put them in.

How people use online social services is shaped – at least in part – by the way they see others using them. On Facebook, while it is possible to use privacy settings to share things with limited people (for example, with only your friends, or friends of friends, or only a selected group of friends), you have no way of seeing what other people's sharing settings are. The assumption is therefore that everyone else can see what you can see. Google+ handles this differently; it is made clear whether a particular post is "public", or limited to be visible to certain other people.

In combination with the "forced behaviour" around Circles, these seem likely to encourage more selective sharing of a more personal nature with one's own friends and contacts.

The privacy controls seem likely to be an appeal for unhappy Facebook users. A survey in the US by ESET/Harris Interactive revealed some interesting points about attitudes and behaviours around social networking sites. It found that 69% are "concerned about security on social network sites", and 67% are concerned about privacy. This might lead you to think that these would have a visible impact on behaviour, but the same survey found the opposite to be true; most people don't seem to act on these concerns. The majority (55% of users) say that they update their privacy settings less than once every six months; 20% have never updated their privacy settings at all, and a further 19% do it less then once a year. (On the security side, 48% of users say that they haven't changed their password in the last year.)

So whether Facebook users will migrate en masse to Google+ depends on a number of factors and remains to be seen; but its difficult to see a good reason for a typical Facebook user to want to move across. While features like Hangouts may be a good incentive to set up a profile, so long as most of your friends are sharing most of their content on Facebook, there is still going to be a strong draw to spend time in that network. But for other kinds of networks that users might want to keep separate from Facebook (such as the professional networks and groups we see on LinkedIn, or looser online communities that users might want to keep separate from their "real life" Facebook communities) there might be a draw in Google+.

Although its worth noting that for some communities, Google+ will not be interesting at all – there is a fierce debate about the weaknesses of a system that forbids anonymity/pseudonymity, as this long but insightful post on Google+ explains . While for any other business building a social website this probably wouldn't be much of an issue, the scale of Google's online operations, their importance in search and the impact on other services makes this a delicate area for them to balance.

The role for brands

Given these expected benefits, anyone interested in looking at 'key influencers' (eg. high-profile bloggers), particularly in the technology sectors should be keeping a close eye on the Google+ platform over the next few months as it develops, both in terms of the application(s), and the communities that spring up.

Business profiles are expected to be rolled out "in the next couple of months", and brands are being advised not to use personal profiles to set up 'fake' brand profiles, as they will be deleted by Google. At the moment, we don't really know what these profiles will look like; there seems to be interesting opportunities, depending on how Google wants the platform to be used. At the least, I would expect to see tools to help more than one user manage a company profile, and "power features" to help manage brands followers (ie. similar to Circles, but set up for audience segmentation – eg. to distinguish a brands employees, customers, prospective leads etc.)

There might also be a role for brands to help manage different types of circles as part of a service. For example, an estate agent might manage conversations between a buyer, seller, lawyers, mortgage advisors and removal companies, or a car dealership might help manage discussions between the buyer, insurance companies, finance providers and so on.

(This slideshare presentation from Publicis Modem UK talks about a few other interesting ideas for what Google+ for brands might look like.)

I would also expect to see close links with company own websites, for example, tools to automatically feed content from a blog or website into Google+. Unlike Facebook (which wants companies to set up and manage Facebook pages, as it gives them incentives to use Facebook's advertising platform to drive traffic to their pages), Google has less restrictions on where it can place display advertising. If businesses want to advertise their Google+ presence, they will presumably be able to do so through YouTube, AdWords and DoubleClick. Because of this, I wouldn't be surprised to see advertising presence on Google+ limited to a simple extension of AdWords (like Gmail, for example), or perhaps like Google Reader, a completely ad-free environment that boosts engagement with the open web (and the advertising opportunities that lie elsewhere.)

In addition, in another quiet move which will help website owners identify and track social engagement on their own sites, Google has released a new social tracking function within Google Analytics (Google's free website traffic analytics tool.) This will enable website owners to look at users who are 'socially engaged'– are they more likely to spend more time on their site, make more purchases, look at particular types of content etc. This isn't just for Google+ users (although the +1 button is the only social action it tracks by default) – it can also track other actions such as the Facebook "like" plugin and the Twitter tweet button.

However, brands who have 'company spokespeople' should look into establishing personal profiles on Google+ (assuming that they already have a similar profile on other networks like Facebook and Twitter, and/or using a blogging platform to build an "owned" social space), enabling users who are already building a presence to engage and share content in the same way.

On the other hand, sharing on Google+ looks likely to be more discrete/controlled than on Facebook. For example, a 'like' on Facebook is both a recommendation/mark of authority, and at the same time a 'share' with their followers. On Google+, a +1 is being compared as a 'like' equivalent, but it doesn't broadcast anything into friends' streams; if users choose to share a piece of content on Google+, then it is a deliberate 'sharing' action. This subtle but significant distinction will have a large impact on the visibility of brands' activities. (A recent comScore whitepaper found that "friends of fans" constitute an audience 34 times larger than "fans" – the equivalent number on Google+ will probably be considerably smaller.)

Conclusion

The limited release of Google+ masks the scale of Google's investment and future plans in the social sphere. Make no mistake – this might be a "technical preview", but it isn't another Wave that can be packaged up and handed to someone else; this is something that will both underpin Google's future projects, and tie together their existing services. Anyone with an interest in the technological side of Google's developments should be keeping a close eye on this project.

From a media perspective though, the picture is slightly different; it seems unlikely that a mainstream audience will rapidly flock to the service. But the value will no doubt lie in the value of the users; the bloggers, journalists and key influencers, and the brands who choose to engage in this environment.

As the role for brands' pages become clearer over the next few months, we will be working alongside our clients to ensure that we are testing and learning about the value that Google's new platform is building and the opportunities it presents for social media strategies, SEO, and both display and search advertising. But most importantly for me will be watching how it affects on users online behaviours as the impact of this new 'social Google' becomes clearer.

Fitting social media to a brand's strategy

Steve Smith's picture

Brand owners know social media is important. One of our roles is to help them know what to do with it

In a recent survey of 302 senior executives at Fortune 1000 companies, Harris Interactive found that over half of them (52%) indicated that social media is currently a part of their company’s customer interaction operations.

However, uncertainty exists about how best to leverage social media. For example, the survey points to confusion around whose role it is to manage social media, and when and how they should be interacting with customers. Most executives (73%) are unfamiliar with how many employees at their company are currently dedicated to “listening” to customer conversations on the internet, and most executives (64%) rely solely on their marketing department for social media monitoring. Furthermore, less than half of executives (41%) in companies monitoring online conversations about its brand, product and/or services only respond to an online conversation when a customer poses a direct question. This represents a significant missed opportunity for companies to proactively engage with people and enhance their brand experiences.

Though interesting in itself, this research relates to a larger point, that strategy should always be the starting point for brand owners when it comes to thinking about social media. Here at Starcom MediaVest Group, we never start with social media. Rather, we look at what our brand clients do and what they want to achieve, and then see whether, and if so how, social media can be used to best accomplish this. For some brands, it may be around buying traditional display advertising on Facebook, whilst for others it may be the design of a Facebook page. For some of these, apps and games may best fit their strategy; for others a retail page on Facebook may best suit.

We should also not forget the importance of measurement. One, which has become very impactful for our clients, is the EIC - a proprietary statistical model we have developed that measures the relative degree of experience involvement to experience exposure. This and our other social media measurement tools show our deep appreciation of the need of brand owners to understand their return on social media experiences.

From strategy through to measurement, we at SMG demonstrate our expertise at social media.

 

Steve is Head of Thought Leadership at Starcom MediaVest Group, London.

Top 5 things to know about Google+ 4) Facebook's data is invisible to Google, but being shared with Microsoft.

Scott Thompson's picture

Part 4 of a five part series of Things to Know about Google+.

Google loves "open." The fundamental idea behind its search engine is "PageRank" – the concept that links to pages represent a degree of 'authority', so a page linked by lots of other pages is likely to be more authoritative or important than a similar page with fewer links. Search has developed considerably since the first PageRank paper was published in 1998, but it remains the central concept; Google uses the web to tell it about the web.

But two features of the social web create a challenge for Google's search. The first is that some web pages aren't visible to Google's spiders. Historically, this would have been because a site doesn't have incoming links (which Google uses to find new pages), or because the site used certain standards to explicitly ask Google not to index it. But on social sites (most notably Facebook) there are increasing numbers of pages that simply aren't made visible to Google, because privacy settings say that only particular people are allowed to see them.

Secondly, as I covered in part one, the 'social web' is creating a new layer of information which create a powerful alternative to links as a source of 'authority.' Not only can people's expressed opinions take the place of abstract hyperlinks as a source of measurement, but with huge numbers of people setting up online profiles, these links can then take the added dimension of where they fit in the searcher's own social graph.

Together, these create a potential foundation for a new kind of search engine. By combining an index of websites with data (ie. an existing search engine) with data from the social web, this could build a new kind of authority index. Who is interested in particular pages? How do those people relate to the searcher? Are they socially linked? Do they have similar interests or other online behaviour? Are they demographically similar? All of these would form massively valuable signals for a social search engine.

Facebook is building a vast amount of knowledge in this area. Every Facebook user has a profile page, which gives them an opportunity to fill in their name, where they live, and some other basic demographic information. In addition, the Open Graph reinforces this profile information with additional data about your "likes"; your interests, which people or brands you are interacting with, and what you are sharing.

From this, Facebook can infer an additional layer of information from your social graph; if a large number of your friends are interested in, say, mountain biking, then there is a better than average chance that you will have an interest in it as well. (And even if you aren't interested yourself, you might pay an interest when birthdays or christmas roll around…)

But does Facebook really pose a threat? After all, they don't have a search engine, and while Facebook provides a very useful search functionality to find your friends, its hard to see a search advertising business growing up around it.

The answer lies not in Facebook's service, but in what they are doing with their data.

Facebook have a partnership with Microsoft that dates back to 2007, when they took a much-publicised $240 million stake in the company. They also recently integrated Skype calls into Facebook (Skype having been recently purchased by Microsoft.) And earlier this year, they announced Bing social search - using Facebook "likes" as a signal to feed Bing's search rankings.

In other words, these kinds of social signals are being integrated into "social search" – but not by Google.

Meanwhile, Google have been working on their own social search product. Originally announced in late 2009 as a project within Google Labs, and "graduated" from Google Labs in January 2010. At around the same time, Google announced that they would be personalising search results for all users, based on previous search behaviour and clicked links.

Last week, Google announced that they were shutting down Google Labs, in a blog post titled "More wood behind fewer arrows." (Again, this points towards the more integrated approach to Google's range of projects I talked about in part one.)

RealTime search has recently made a similarly mysterious disappearance, and with news that their Twitter deal recently expired (Twitter making up the majority of realtime search results), it seems likely that there are plans afoot to integrate this with Google+. Presumably, rather than focussing on Twitter as a source of data about what is happening "right now", it will focus instead of the social nature of Twitter – going back to the idea that the most important clue that something someone on Twitter is saying will be whether you are following/being followed by them.

As Google said in the blog post which announced the Google+ project;

Today, the connections between people increasingly happen online. Yet the subtlety and substance of real-world interactions are lost in the rigidness of our online tools. In this basic, human way, online sharing is awkward. Even broken. And we aim to fix it.

Google's interest has always been in getting people to spend more time online, relying on the web for more of their day to day activities, and relying on search to help them navigate. Google+ is on the one hand, a way to help people to share information online. If people aren't sharing something – anything – online, whether its because its too complicated to post it, or because they are worried about it reaching the wrong audience, or because they don't understand where the right place to share it is, then Google see that as a problem that Google+ sets out to solve.

But focussing on the business rather than the altruism, its also a way to make sure that they share it in a way that can benefit Google – and not just the highest-paying competitive bidder.

In the final part tomorrow, I will take a look at the expected users of Google+ – who are they likely to be, and what are they likely to be doing?

Top 5 things to know about Google+ 3) Search advertising is much bigger than online display advertising

Scott Thompson's picture

Part 3 of a five part series of Things to Know about Google+. In Part One, I talked about the growing opportunity that the 'social web' is presenting to Google, and in part two, I talked about the threat being presented to universal search.

So far, I haven't mentioned much about the competition; the inevitable comparisons to Facebook, and the questions of whether Google+ will be a 'Facebook Killer."

Facebook has obviously got a lot of attention over the last few years, with its rapid growth and 750 million active users (giving rise to some fun statistics; if it were a country, it would be the third biggest in the world, and there are more people in the US with Facebook accounts than passports.)

Is Google trying to "steal" from these numbers? It seems like a massive challenge - Facebook has rapidly become deeply embedded into people's lives; for sharing information with friends, it performs a valuable function that can't be easily replicated. If even a quarter of your Facebook friends were to leave and migrate to Google+, the remaining friends on Facebook would still give you a good reason to visit the site regularly. The network effect has been a powerful force in as siting Facebook's growth; it is likely to be an equally powerful force in retaining its user base.

More interestingly from a media perspective is the amount of time spent on the site. In the UK (where Facebook adoption was fairly early – we didn't flock to MySpace in the way that many early social network users in the US did), Facebook accounts for a huge proportion of time spent online. The visualisation below shows the share of time that Facebook accounts for in comparison with some other major websites- the area in the large circle representing all time spent online.

By this metric, Facebook dwarfs Google.

Importantly thought, unlike the technology industry of the 1990s and famous Microsoft vs Apple and Microsoft vs Netscape rivalries, the corporate battles of this decade are not necessarily zero sum games; it is perfectly possible for consumers to maintain more than one profile online. Despite the dominance of Facebook, we still see thriving communities in networks like LinkedIn, Twitter, Quora, as well as countless networks of blogs and forums. It is probably these more specialised networks that need to be more concerned with Google's social ambitions and their implications, and questioning whether they are a potential partner or a threat.

But Facebook is also building enormous scale in the amount of data it is collecting about its users; demographic information, social graph information, and (through stated "likes") information about its users tastes and interests. Add in the less visible layer of data it can collect from Open Graph plugins (eg. 'like' buttons) on 3rd party websites and Facebook also has the ability to collect behavioural data; not just the web pages users' have liked, but also other pages they have visited.

The real customers

But from a business perspective, what would a "Facebook killer" really need to do? Replace Facebook as the chosen destination for sharing photos and status updates? No- Facebook is a media company, and it's business is selling advertising. A Facebook killer would just need to provide a better advertising platform.

Facebook's business –like Google's – is in advertising. Comparing the value in terms of media spend provides a very different picture.

With overwhelming statistics like those above, it is easy to forget that the real competition isn't for the most users, the most pageviews, or the most time spent engaged with a website; it is for advertising revenues. The real customers of Google and Facebook aren't the users, but the advertisers who provide those revenues.

In this field, the current picture is very different.

"Official" figures aren't quite as clear, but estimates from Enders Analysis for 2010 were that Facebook's revenues in the UK were around £100m. Google's display revenues from the UK were around £125 million, making it the biggest display advertising business in the UK –but Facebook's rate of growth means that it is quite likely to overtake Google soon (in fact, it probably already has.)

But to put those display figures into perspective, according to the IAB/PwC 2010 AdSpend report, paid search advertising in 2010 was a £2.3 billion industry, with Google taking the lion's share (around 90%.)

In other words, Google's total advertising revenue from the UK alone is around twenty times as big as Facebook's. The picture in other countries is similar, but less extreme; in the US and across Europe, search advertising accounts for around 45% of online ad spend. (The UK is slightly unusual, in that it has a greater proportion of online advertising spend on search advertising. It also has a greater proportion of total media spend on online advertising.)

Google's total reported revenues in 2010 were $28.3 billion. This was greater than the entire US online advertising industry ($26 billion.) Or to put it another way, the $3.7bn (£2.26bn) they spent in Research & Development is larger than the UK's entire search advertising spend.

What this means is that Google are in a position to invest far more in the development of Google+, and to promote it more heavily. Few other businesses have the resources that Google can bring to bear – even Microsoft (who have huge revenues from other areas of their business to fall back on) are struggling to make their online business work. For Google, integration of "social" isn't just a way to develop their core product; it will also allow them to compete with Facebook in targeting users, based on the kind of profile information that a social service allows them to collect. Google profiles existed before Google+, but what Google+ is doing is given people good reasons to fill them in.

Facebook's future growth will almost undoubtably be in the area of display advertising. While it will challenge Google's display advertising business for some advertisers, the two products are positioned to offer quite different products; Facebook is based around targeting the user via demographic details and interests, while Google's is focussed around targeting the right moment – the point of decision making, based on search and other online behaviours. With Google+, provided that enough users set up profiles that Google can tie in with other online behaviours (such as clicks on "+1" buttons, and website visits based on AdWords and DoubleClick tracking.)

So there is plenty of room for growth for both Google and Facebook in terms of online display spend – but that's not to say that there isn't a threat to Google's business in Facebook, as I will look at in part four tomorrow.

Top 5 things to know about Google+ 2) "Universal Search" is broken- you don’t look for people in Google

Scott Thompson's picture

Part 2 of a five part series of Things to Know about Google+. In Part One, I looked at the rise of the Social Web, the importance of online identity and the opportunity that this presents for Google. This time, its the problem that Google faces with Universal Search.

Google's stated mission is to organise the worlds information, and make it universally accessible and useful.

The web is fundamentally a decentralised collection of information; websites, web applications and pages. Although links provide useful related information and references, without a "front page", EPG or index, users need help to navigate it, and search engines provides a good starting point.

It just happens that in asking users what they are interested in finding, they have created a very valuable space for advertisers to reach a self-selected, targeted audience of people who have declared exactly what they are interested, at exactly the time that they are interested in finding it.

In 2007, Google set out their vision for 'universal search' – the idea that, while different types of search might be useful for particular needs (for example, image search, video search, blog search, product search etc.), Google's main search function would combine all of these in a single "universal search" engine. In other words, whatever it is you are looking for, a Google search would help you find it.

Back in 2001, Eric asked for a brainstorm of a few "splashy" ideas in search […] Even then, we could see that people could easily become overwhelmed with the number of different search tools available on Google -- let alone those that would be created over the next few years. This proliferation of tools, while useful, has outgrown the old model of search.

This "universal search" idea is key to Google's simplicity – while it has introduced different products alongside search, and introduced innovative ways of searching with cameras, with voice, and different ways of returning search results for specialised searches, or for making searches faster, they all still rely on the principle of a single search box.

"Google Me"

Social media (most notably Facebook) has created a problem for Google. If you want to find a person online, unless it is either a particularly famous individual (or someone with a name that is unique, or has an unusual spelling) you will probably have become less likely to use Google's search engine to do it.

If you Google me, you will – probably – find some people who aren't me– the CEO of PayPal, or one of two comedians who happen to share my name. On the other hand, if you search for me on a site like Facebook or LinkedIn, then there is a reasonably good chance that you won't have to scroll through several pages of results before finding something that might actually relate to me. (Especially if we have something in common that the network knows about– for example, mutual friends on the same network, or both belong to the same groups.)

These searches might not be particularly valuable searches in terms of advertising (with the occasional creative exception), but they challenge Google's philosophy of the single, universal search engine. (There is also a different type of value being generated that I'll come back to in Parts 3&4.)

For Google to fix this problem with their own search engine, they need to know more than just a name; whether we are connected (perhaps by a mutual friend in our Circles, or a shared interest we follow via Sparks), and whether you might be more interested in Scott Thompson the digital media researcher than Scott Thompson the PayPal CEO or Canadian comedian.

For that to work, they need to understand something about both my online identity (as the target of your search), and yours. And for you (and me) to share the information they need to make that work, they need exactly the sort of information that is currently being shared with sites like Facebook, LinkedIn, Twitter and other networks.

So the first challenge for Google seems to be to provide a social networking service that encourages people to share this sort of information with them.

Identity and Anonymity

But this gives rise to a potential problem. If I want you to find me through a Google search, I have to give Google enough information to first identify my profile as the one you are looking for, and also to allow Google to give you, the searcher, enough information to confirm that mine is the profile you are looking for.

This explains why private Google profiles will be deleted after July 31st. In fact, the idea of "private profiles" is a little misleading; with only a single exception, every element in a Google profile can be set to have limited visibility; if you only want particular circles (or the 'friends-of-a-friend' in extended circles) to be able to see your photos, home town or other personal information then Profiles offers privacy settings to allow users to control visibility. But the one element that must be publicly visible is your name.

This has led to some controversy; a number of stories about deleted profiles (including one high profile blogger), and some heated debate around the topics of free expression, protest against oppressive regimes, protection for whistleblowers, and the legal obligations of a service provider to reveal information about its users to the police when requested.

Robert Scoble (a very high-profile blogger covering the tech scene) reports a conversation with Google's SVP of social where he outlined the intended effects of enforcing a 'real name' policy;

He says it isn't about real names. He says he isn't using his legal name here. He says, instead, it is about having common names and removing people who spell their names in weird ways, like using upside-down characters, or who are using obviously fake names, like "god" or worse.

[UPDATE- In another statement via Google+, VP of Google+ Bradley Horowitz has explained some revisions to the policy]

I don't think there is much of an argument that this won't be an effect of forced identity/accountability; the effect of allowing open and anonymous commenters has been discussed at length. But to me, it seems much more likely that the core reason is for profiles to be a) findable through a search, and b) identifiable as the profile being searched for. (It may well be that there are other tangible benefits which may come down the line, but the immediate impact of personal 'findability' seems a much more pressing issue for Google.)

This also relates to Google's plans for brand pages on the site – at the moment, businesses are being discouraged from creating Google+ profiles for their brands. A spokesperson for Google has outlined the plans for brand pages, which they expect to have up and running "in the next few months." In the meantime, the best advice for brands is probably to follow the lead of Google themselves (as well as Mashable) and look to creating spokesperson profiles where there is a clear role for brand engagment and activity on the site.

Another clue about Google's core goals in the Google+ project is the recently announced authorship markup; Google is now supporting the technology that allows authors to identify themselves in their work online by linking it to a page that represents their online identity. So, for example, I can put a link on this page to my profile page on this site, which tells Google about the identity of the author. In turn, my profile page here links to (and is linked from) my Google profile, telling Google that the two profiles relate to the same identity. In turn, this means that if one of my contacts happens to be looking for information about Universal Search, Google will be able to identify that this page – which may well have been listed outside of the first page of results – might be of particular interest to them, and show it to that particular user higher up the search listings.

Again, this shows how the "social web" and identity will bring value to Google (and to brands) that go far beyond what we often currently see in "social media", especially for people who are interested in building their own profile and visibility online.

Its probably not a coincidence that the rumoured name for Google's social project was "Google Me"…

In Part 3, I will take a look at the competition between Google and the main contender in the social space; Facebook. Most importantly, exactly what it is that they will be competing for.