A blog for Website Managers ...
The Google Monopoly
When was the last time you “Yahooed” a restaurant? Howabout “Binging” someone to learn more about them? Maybe, never. Google’s search engine monopoly corners online advertising so that there is a lack of competition from other companies. Characterized by Google’s singular power to control where customers turn, their monopoly provides the ability to charge what they want, when they want to. The European Union agrees Google needs to stop hogging the market, and they issued a list of Google’s monopolistic practices following a two-year probe:
Google hogs specialized search – Google prominently displays links to its own specialized search services within its web search results and does not inform users of this favorable treatment.
Google hogs content usage – Google uses without consent content from competing specialized search services in its own offerings. Google thereby benefits from the investments of competitors, sometimes against their explicit will.
Google hogs with exclusivity agreements with publishers – Google requires web site owners to display no or only a limited amount of online search advertisements from Google’s competitors, which reduces the choice of online search advertisements they can offer to users of their web sites.
Google hogs by creating contractual restrictions on the portability of Google’s AdWords – Google contractually restricts the possibility to transfer online search advertising campaigns away
Bing accounts for 17.9 percent of search share in the US but they may be gaining ground on Google. Without irony, Microsoft’s CEO recently called on the US Government to break up Google’s monopoly on search engines. Nevermind their long battle with the federal government over their own past monopolies.
Governments won’t likely be successful in breaking up the mega-company that is Google, precisely because there is nobody doing as good as job. We Google because no service has proven better at search results. Nonetheless, calling a monopoly out doesn’t meant it should be broken up. In fact, the break up will occur through the natural shift in user preferences and methods for accessing search results. There will be new entrants coming into the market attempting to disrupt Google’s corner on advertising and searching. The introduction of mobile technology and new gaming systems, for example, demonstrate the move away from Google already. Bing is featured as the default search engine on the Xbox 360. Geographically Google is, arguably, a lost leader in Asian markets already. Understanding that Google does not monopolize all countries should be an indication of how other models are evolving market standards.
oDesk’s Cheap Labor is Scorned by Elance Users
Users on Elance and oDesk have voiced strong disapproval following the merger announcement. “Even after you merge, please don’t go cheap, don’t turn our Elance into odesk with it’s $5 projects and $1 rates. Let us continue earning our $$$$$$s,” begged Konstrantin Sharipov on the Elance Facebook page. While the companies are quick to insist that the platforms will continue to operate separately, the vitriol on Elance’s Facebook page should be enough to remind the executives that their savvy business deal has practical complexities that make true integration nearly impossible. Similar to Mac users versus PC users, Coke versus Pepsi and Chrome versus Firefox, the two platforms vie for clients by offering feature sets that are entirely different but subtly the same. Chris Fernandes commented “oDesk is like working at the MacDonalds of Freelancing.” Denise Casas commented on the oDesk Facebook page that the “oDesk interface is way better! Please continue to keep it simple and FREE for freelancers.” Most agree that oDesk excels at hosting low-cost labor contracts while Elance brings higher paying jobs. A minimum wage on Elance helps to enforce the difference.
While the specifics of the merger were not disclosed, our recent outsourcing portal expose dug up enough details on the two companies to speculate that Elance initiated the consolidation and will keep the upper hand. Gary Swart, chief executive of oDesk, was deferential following the announcement: “We don’t have to merge. We chose to.” The post-merger managerial structure puts Fabio Rosati, Chief of Elance, ahead of Mr. Swart who will be relegated to a “Strategic Adviser” – code word for being shown the door.
Despite Elance’s leverage, oDesk seems to have the market share in the volume of users and contracts. As the two companies await regulatory approval, oDesk outperforms Elance by an estimated $200 million per year in revenues. But executives at Elance in Mountain View, California have been more profitably in raising venture capital and maintaining customer loyalty – they’re estimated to have raised nearly $40 million more than oDesk last year. The company is also significantly older than oDesk which implies a more loyal customer base.
Nonetheless, consolidation of operations is why this merger makes sense. Their wait-and-see attitude will prevent significant changes to user experience for the time being. Time will tell how the two platforms leverage features across the isle.
“We have two very distinct platforms, each of which has value to its specific user base … so, in our case, we’re not focused on the traditional synergies two mature businesses might have, we’re trying to approach [the deal] in a unique way.” – Statement from Elance CEO Fabio Rosati
In the meantime, the Facebook fear mongers are united on one point that has historically occurred following mergers of this nature: everyone’s fees will increase when the competition is eliminated.
The below email came from Gary Swart following the merger announcement, its vapid content revealing nothing of how users will benefit from the merger, except to say there’s going to be “Significant technology investments” and “higher quality results”.
How to survive an outsourcing portal
There are loads of ways to outsource a website or to find one to build. From oDesk to Elance to Freelancer to 99designs – all of these services take a commission of about 10% on each project and all have great project management software built into a solid feature set. The numbers don’t lie – these outsourcing portals are making big bucks.
Of course website managers must beware when contracting new individuals to work on precious projects for existing clients, and subcontractors looking for work through these job boards are subjecting their reputations to contractors who they know nothing about. Keeping a few basic precautions in mind, however, website managers can play both roles with aplomb:
Freelancers are working for freelancers – The majority of contracts signed on these sites are contractors hiring subcontractors. By understanding that everyone is in the same boat, your sympathetic approach will be reciprocated in kind.
Start Small – Freelancers know it takes time to build a good relationship. In fact, they’ll tell you they don’t want to commit to a big project without first running a test. It is in everyone’s best interest to protect their publicly reviewed reputations.
Communication is King – We can’t stress this enough for all parties involved. An email every day is enough to make everyone feel like they’re on the same page. Inevitably, when something goes wrong in a contract it’s almost always because one of the parties didn’t communicate in a timely manner.
Good reviews matter – At the end of every project, your next project is only as good as the footprint left behind on the last. Yes, it’s social reputation management through the positive feedback left on the project. The reviews tend to be extreme, so it’s either five out of five stars or zilch. Be prepared for blowback when panning someone. Revenge can be a bitch.
Build a team – Think of these services as a dating website where you keep your favorites in a folder to call on in the middle of the night. The best success will come from repeated success.
Remember that these communities of users survive and thrive primarily because they are tightly knit and fair. There’s no room for big egos or jerks. There are plenty of cynics who find the experience using these portals to be less than satisfying. Qualified applicants are as difficult to find as qualified projects, so respect for all participants will take you to success.
Why website managers should ignore apps
My grandpa used to say the difference between reading a magazine and a newspaper in the bathroom is the same as using a mallet or a fly swatter to kill a fly. If pressed on the vague analogy he would stop short of crudeness saying something along the lines of “we never had toilet paper in those days.”
We are inundated with the solutions to non-problems. One example is how our media outlets extenuate these non-problems by pushing the wonderfulness of phone apps, and last week’s New York Times article by Paul Boutin is a case in point. Putting aside the naivete (he obviously doesn’t use his camera) that 60 megabytes per month is sufficient storage, or even that a paid gigabyte per month would be enough, he does admit the casualty of putting yet another utility on your phone.
The only real downside with Evernote is that it has so many features, which can make getting started with the app daunting. But once you understand how to do a few things with it, you can get working and worry about the rest later.
Complicating our lives with an ever-expanding array of bells and whistles, feature creep is the scourge of us all.
The worst thing a website can do is to do too much. Companies like Apple and Google have succeeded by stripping down features and relying on interface simplicity. We should do the same with the devices we overlay on our lives. It’s one thing to enjoy the quirky features and fun modes that apps provide on our mobile devices, but it’s quite another to buy into the notion that loading another app on your phone is going to simplify your life.