I’m getting caught up in the US political elections. I’m staying up most nights until about 4AM during the primary/caucus season watching CNN or reading the Wall Street Journal and The New York Times for more coverage, more analysis. (I’m especially loving the integration of blogs and video streams in The New York Times.)

And the big story before today’s New Hampshire primaries is that Hillary Clinton showed . . . emotion. She actually got teary-eyed when a female questioner asked her how she deals with the pressure, frustration, disappointment and constant attacks. In short, how can you not take it personally when everyone basically says that you a cold, cunning bitch? Doesn’t it hurt that all of your experience, preparation and contacts are irrelevant because most people don’t like you and won’t like you no matter what you say or do?

Obama emotes. Bill Clinton cries. Even George Bush got teary-eyed when remembering the terrorist attacks. But the fact that Hillary — a woman — shows emotion is what people consider noteworthy. (This reminds me of the Sex and the City episode whether Charlotte warns Samantha that the worst thing that can ever happen to a woman at her job is that her co-workers see her crying, because from that moment on, she’ll be labeled weak and emotional.)

I don’t really think it’s all Hillary’s fault, though she must accept some of the blame for her personal choices. I mean, even I was happy to see that she finally let her hair down and stopped trying to be a superhuman SuperWoman. But I do understand that powerful women in high-powered positions often have no choice but to become near robots in order to survive in corporate America. Some of my best female friends — people who I know have more heart, soul and conviction than 99% of the population — are so wrapped up in being as good as men at work that they find themselves wondering whether all of their professional success was worth the personal sacrifices — no meaningful relationships, no kids but lots of money.

Political America has to be even worse. In a context where survival of the fittest is the only relevant principle, Hillary’s had to develop a thick-skin to show that she’s not a stereotypical woman who’d launch nuclear war because she just had her period. Even when her traditional status as a woman was challenged when her husband cheated on her on numerous occasions before the entire world, she maintained a brave face for her family’s well-being. And while trying to be a good wife and good mother, she also had to navigate being a powerful woman who grew up when it wasn’t so common for women to have power (she is 60 years old after all). Fortunately or unfortunately for her, she was never the beauty queen, so she couldn’t rely on her feminine wiles as a defense mechanism. She’s no Southern belle.

So after literally decades of toughening her skin to be able to deal with all of the personal attacks — she’s not pretty enough . . . why would she wear that? . . . is she getting fat? . . . her daughter is not so pretty — she inherited her mother’s looks . . . she’s too manly . . . even her husband prefers to screw every ugly trashy woman who give him a bit of attention rather than be with her sexually . . . i wonder if they have sex . . . people say she is a lesbian . . . — people are surprised that she’s not highly emotional in public.

I think it goes to show that the more things change, the more they stay the same. Even though all of the candidates are promising “change”, it’s clear that change is slow, frustrating and sometimes ephemeral. When I was a college student so many years ago, one of my favorite US constitutional law cases was Hopkins v. PricewaterhouseCoopers. Long story short, Ann Hopkins was a ball-busting top accountant at PwC up for partner in the 1980s. Even though she was a top performer, the firm opted not to make her partner, based on the fact that she was not feminine enough. They thought that she was too aggressive and literally advised her to walk, talk and dress in a more feminine manner. She sued PwC in 1983 for gender discrimination. The Supreme Court agreed with her. And from what I remember of the legal opinion — I haven’t read it in at least 10 years, so that’s a pretty big caveat — the Court argued that this kind of attitude puts women in an impossible position, a catch 22: They have to prove that they are at least as “tough”, “emotionless” and “professional” as businessmen, but they must also be “feminine” and “lady-like”. In other words, women must be part Scarlett O’Hara, part Rambo. The can’t be “pussies”. They had to show that they have “balls” but they can’t be “bitches” either.

This is a balance that men typically don’t have to make, and it’s one that’s near impossible to achieve. The result is a glass ceiling that means that women often don’t ascend to the highest levels in business or politics. That was true 25 years ago, and it seems to be equally true today.

I’m not going to go so far as Gloria Steinem, who has an editorial in the Times saying that racial progress often comes at the cost of gender equality. Like so many feminists before her, she argues that it makes sense that Americans would vote first for a black man before they’d vote for a white woman, because a man — even a black man — is still a man. I think that this is a tired argument, and no one was making this argument even 2 weeks when Obama’s biggest liability was the doubt that white America would never vote for him, while everyone assumed that Hillary Clinton would be the Democratic candidate. In the US, I think that white women as a group are generally more powerful and economically privileged than black men (to say nothing of black women), and certainly better represented in the halls of power. But as I said, I’m not going to go there.

I will simply say that I feel badly that even Hillary Clinton can’t escape her gender’s glass ceiling. And if she can’t do it, I don’t see why we should think that Obama will be any more successful in escaping his race’s glass ceiling. It’s just a matter of time. I hope I’m wrong, but my biggest fear is that the media is building him up — just as they did over the last 6 months with Hillary Clinton when she was declared unbeatable — only to tear him down when they all remember in the privacy of their voting booths that he’s really a not-so-nice-word-that-begins-with-n-and-is-still-used-in-some-corners-to-describe-black-people.

Over the Christmas break in New York, I did one of my favorite things in the whole world: I watched a lot of TV in my pajamas without moving for 24 hours. Even though I love Europe, I crave American pop culture whenever I’m back in the US.

So I spent a lot of time watching MTV, VH1, Bravo and a few other cable stations. With the remote in my hand, I came to appreciate just how much reality TV dominates US air waves, and with good reason: You can’t make this stuff up! Following in reverse order is a list of my top 5 US reality shows. If you can buy them on iTunes or find them on emule, I highly recommend that you do so. A lot of them are now available via streaming directly from the various channels’ websites, so you can get them for free if you are willing to deal with a few commercial breaks.

5. The Real Housewives of Orange County: When I lived in the US, Bravo was the high-brow arts and entertainment channel focused on wealthy people who love the arts. But after the success of “Queer Eye for the Straight Guy” (five gay guys help a clueless straight guy become “fabulous!“), it’s still focused on wealthy people, but with a generous bit of reality trash thrown in. Hence, “The Real Housewives of Orange County”. Orange County is one of the richest neighborhoods in the US state of California, so the show focuses on pretty silly rich woman looking for love and/or more money. It’s quite literally meant to be the reality TV version of Desperate Housewives, but after three seasons, the formula is getting a little bit tired. Reality TV begins to suck when it’s clear that the participants are exaggerating their reactions or, even worse, acting. I like seeing crazy people being crazy. Fake celebrities acting crazy to maintain their fake celebrity is not quite as interesting.

4. Project Runway: A simple formula now in its 4th season. A beautiful and appealing hostess who doesn’t get in the way (Heidi Klum). Successful designers as judges, including Donna Karan, Michael Kors and Nina Garcia (Elle magazine fashion director). And 15 young designers representing various demographics. The three finalists get to present their work on the runway at New York Fashion Week before real celebrities and the international fashion scene. The winner also gets an editorial spread in ELLE and $100.000 to start his/her own fashion line. So it’s a real competition with a meaningful prize for people whose main goal in life is larger than being a reality TV star. That realness is what makes the competition intense. And the fact that fashionistas tend to be bitchy and catty also help to keep the real-life drama factor way up! (Full episodes are available on Bravo’s website. Below is just an excerpt that I found on YouTube.)

3. Made: It’s MTV’s way of convincing teenagers that dreams really do come true if they work hard enough. The show tends to focus on issues important to teenagers but ripe with comedic possibilities — for example, the fat girl who wants to be prom queen, the Jewish nerdy kid who wants to rap like Jay Z, the cheerleader whose secret dream is to be like the skater kids, etc. Each kid who wants to get “made” reflects a high school prototype and is assigned a “trainer” who represents exactly what the teenager wants to become - a mentor/role model to show that the goal is possible. And the entire episode shows how no one believes that the kid can do it, how the kid also doubts herself, how the trainer kicks her ass, how she starts to falter before eventually fulfilling her goal through hard work and determination. It’s a great piece of propaganda to inspire kids to work hard and keep believing in themselves. And it’s funny along the way watching the nerds, cheerleaders and fat kids make fools of themselves in their attempts to fulfill their dreams. (MTV streams the full episodes from their website.)

2. A Shot At Love with Tila Tequila: No one in the offline world had any freaking clue who this girl was before this show. My sister had watched every episode and had read about Tila’s private life, but she had no clue why or how Tila was a “celebrity” with her own show, or why MTV had chosen to make her the host of their New Year’s Eve special. After a little bit of research on Wikipedia, I discovered that Tila is a former nude model whose claim to fame is that she has 2 million friends on MySpace. That’s it, folks. That bit of notoriety got her a recording contract and a television show on MTV. Now everyone knows her name. Fame. And the show itself added fuel to her whole Vietnamese Internet sex kitten image (the mix of subservience and sex goddess included) when Tila announced during the first episode that she was bisexual. So the twist on the traditional reality dating show format is that 16 boys and 16 girls had to convince her: i) which gender she preferred; and ii) of that gender, why he/she was the best candidate. She French-kissed and made out with pretty much each of the guys and girls, all the while claiming that she was really looking for love. She gave one finalist’s grandmother a lap dance, and then did a pole dance before the two finalists’ parents. She did this all without seeming like a slut, just like a nice girl looking to have “innocent” fun. The Vietnamese bisexual Britney Spears. Riveting TV indeed. (Full episodes are available on MTV online.)

1. I Love New York: For the record, it’s almost embarrassing to admit that I love this show. It is the most popular reality TV show in the US. The original idea was that Flavor Flav, one of the ugliest guys ever created and a former rapper with Public Enemy who was borderline homeless before the show began, would give a group of “lucky” women the chance to fight over him and possibly become his bride. The show was a runaway hit, as the girls were straight-up ghetto. These women were definitely not ladies, and their ghetto trashiness made help make the show a huge hit. Tila Tequila’s show is almost a direct copy of Flavor of Love, except with a bisexual sex-kitten twist. New York is the star of this spin-off, and she is hilarious. She is always smoking her Newports (cigarettes arguably found only in the inner cities of New York), has big fake breasts and is absolutely crazy. But she’s entertaining. There’s absolutely no way to get bored when watching I Love New York. It’s obviously somewhat staged (did anyone really think New York would end up with a “small person” who didn’t even reach her left breast?), but there’s enough real craziness there to make it worth it.

I was recently invited to be a speaker at the International Classified Media Association’s general meeting, which was entitled “100% Digital”. I was supposed to represent and explain web 2.0 to traditional print media classified companies. Henri and I took the trip to Amsterdam on Wednesday (i.e., Halloween), missing the puente but looking forward to the famous coffeeshops.

When preparing for the conference, I was expecting a bitter backlash from incensed traditional media types given that my message was: “Promote online or perish! Property search engines like nuroa are the future!”.

Ouch!

Harsh, right?

But the general response was: “Yeah, we know that, so how can we work together? Let’s sit down and consider the possibilities. We are all prepared for co-opetition”.

In general, everyone was very receptive to the message, and in fact, my message was one of the milder ones out there. Some members of the organization said it in far more blunt terms, making sure that members clinging to purely traditional models got a kick in the pants, in case they were still stuck in the 1990s.

And equally as impressive, a bulk of the presentations were “member-to-member”, meaning that current members of the organisation explained to their co-members how they’d updated their sites and what advantages they’d reaped as a result.

I spoke a bit with the CEO of a Dutch vertical search engine and learned abot how classified sites in Estonia, Finland, Russia and the US were working on integrating web 2.0 features. It’s amazing how people in such diverse places are generally doing the same sorts of things.

And there were workshops on usability, SEO, applying classifieds to the mobile world, etc.

In general, not a web 2.0 stone was left unturned.

And you definitely had the sense that the members had formed a close-knit family, facing an adverse situation, but determined to survive. This despite that fact that some of the participants were from “big” companies like Careerbuilder, Schibsted and Trader.

I thought it was a great conference, and I’m happy that they invited me (after reading a comment that I’d left on another post and then reading my blog). I made a lot of great contacts, some of which will likely result in collaborations and/or friendships, and as importantly, I learned a lot about the classifieds industry from people who’ve been working in it for the last 20+ years.

Congrats to Lucie and Shay.

Sorry, that’s a random reference to one of my favorite “dumb” movies — White Chicks from the Wayans Brothers. It’s basically the ghetto equivalent of saying “Bring it on!”or “Let the Games Begin!”

Long story short, News International has invested in a UK property vertical search engine called Globrix. A few key facts:

• The investment was for “a multi-million pound funding round”. Combined with the valuation that Properazzi got from Mangrove just for the initial idea of a vertical search engine a couple of years ago, it shows that the property search engines like nuroa are an increasingly interesting area.
• The company, Globrix, still hasn’t launched, but intends to launch during this month. The company was founded in 2007. If you go to their website, you will see that they are still in private beta. This makes me a little better about all those people who asked “When are you going to launch nuroa?” Sometimes the prize doesn’t go to the person who launched first.
• The million-pound investment appears focused on marketing and advertising, as the goal is to make Globrix one of the most trafficked property sites in the UK within the next 12 months. So they’re going to buy their way into being a market leader.
• Globrix’s business model appears to be exactly the same as nuroa’s.
• News Corp claims that the technology is “next generation”, which is simply another way of saying “a web 2.0 property search engine”, just like nuroa. As the CEO of Globrix explains: “Globrix is about answering a fundamental need in this marketplace - creating a Google-style model for the property search industry. By enabling agents to list for free we cover virtually every property in the UK, which in turn provides a hugely compelling proposition for consumers and creates a new opportunity for an ad-funded model.“
• News Corp argues that investments in vertical search are a key part of its digital strategy (it should be remembered that News Corp invested $13.5 million in the US jobs vertical search engine, Simply Hired ( www.simplyhired.com), which Google is reportedly in talks to buy, a fact confirmed to us by a News International representative at a conference that we attended recently. In any case, News Corp appears committed to vertical search. As Clive Milner, Group Managing Director, News International, said: “Through its digital and print media, News International is one of the largest single players in the UK property media market, so this investment is about us remaining at the forefront of what’s happening commercially and technologically. Globrix is set to be a truly disruptive business in the online property search marketplace - it essentially turns the economics upside down and creates an unparalleled consumer offering from an innovative business model.”
• News International invested in a property search engine, despite already owning 50% of the number 2 property portal in the UK (Property Finder — www.propertyfinder.com). As mentioned above, they note that the new technology is the next step forward, even taking in account their years of experience in the classifieds sector, both print and in web 1.0 vertical real estate portals like Idealista and ImmobilienScout.
• All of this despite the fact that the UK property market is one of the most difficult, given the economic power of Rightmove (a valuation of €1.2 billion) and its exclusive control of the real estate agents (the top 3 real estate networks that control about 60% of the market are their original JV backers). No other market in Europe has barriers to entry as high as the UK market or as many strong already existing competitors. By comparison, the France, Spain and Germany are relatively easy — the market leaders aren’t quite as dominant and there are fewer property search engines covering those markets.

I think this is good news for other vertical search players, particularly those of us not focused exclusively on the highly competitive UK market. It seems that Globrix will do essentially the same thing, but will now count on a few million pounds to attack other UK players such as Extate, OnOneMap, Nestoria, Zoompf, Right Move, etc.

More news to come tomorrow about the recent ICMA conference, and the present Web 2.0 conference that I’m attending.

Online videos (and a tabloid-worthy personal life) killed the untalented pop star.

Britney Spears is over. She’s amassed an amazing fortune based on limited talent and her ability to glamorize normalcy. Her unique trait seemed to be her hunger to succeed and her Janet/Michael Jackson-like performance skills.

But that was two kids and a rushed marriage ago.

Her performance at the MTV Video Music Awards were profoundly normal but decidely unglamorous. It was like a bad Karaoke night in little Tokyo. The lip-synching sucked. The dance moves were limp. She was sporting a beer gut, despite being dressed skimpily in “sexy” lingerie.

The most interesting part of the entire performance was to see how MTV is now using online videos to pump up its declining relevance and to combat YouTube.

In addition to the Britney performance, MTV’s website boasts Kanye West’s meltdown (he complains that a black man apparently can’t win an MTV award — with his bank account, I hardly feel sorry for him. I don’t think that his failure to win an MTV VMA is the biggest struggle facing the black male population).

And there was the all-out, “white-trash” slugfest between Kid Rock and Tommy Lee, both of them ex-husbands of the even more sordid Pamela Anderson.

Apparently, the fight was for Pamela’s virtue. A losing battle.

And it was all caught by MTV’s cameras and streamed via its online player.

Of course, I didn’t watch the MTV Awards. I read about them online in the New York Times and perezhilton.com, before redirecting myself to MTV’s website to see the highlights.

MTV apparently understands that you won’t view the awards on regular TV either. They’ve completely revamped the format to focus on the YouTube generation that wants more performances, fewer speeches, and all of it in short video snippets. And they’ve promised not to rebroadcast the show 100 times on their channel.

Instead they’ll let you stream it from their website, based on your preferences.

And they’ll sue anyone — in particular, YouTube — that attempts to broadcast their content without permission or a good revenue-sharing plan.

Once again, it’s clear that Internet is disrupting media — some of it traditional, and some of it more provocative and youthful like MTV once was. (For a less pop-culture review of the disruptive force of online videos, see Ollivier’s post (in Spanish)).

Did you know that the English term “mortgage” originally meant “dead pledge” in French?

Real estate (or property, as the Brits say) almost meant “dead pool” for me. (”Dead pool” is the term that Michael Arrington of TechCrunch uses to characterise failed tech start-ups.) I ran my own real estate business for three years, so I fully appreciate the challenges that small real estate agencies face.

We started out as a franchisee of a well-known Catalan agency, but we soon found out that we were paying 2-3x more to advertise on a weekly basis than if we had called the newspaper and placed our own ads. The extra money was to subsidize the franchise’s expansion, but we never received anything of equal value in return.

We were too dumb at that point to realise that it was larceny.

We asked them why they didn’t improve their website to cut expenses, but they treated us like silly little kids and told that Spaniards don’t use the Internet to look for apartments. That we were being too American.

They were wrong: Most Spaniards initiate their real estate searches online. It’s not an American thing, it’s a common-sense thing.

And the franchisor’s website still sucks.

So we asked them to buy us out of our remaining franchise payments, and they agreed. And so we moved our staff to our independent office.

Things were going better for a while. We had more money to spend on marketing, and we used an approach that included 2 local newspapers and various online sites, including Loquo and Idealista.

We found that sites like Loquo and Idealista generated loads of new clients, but there were key differences in the types of calls that we received.

At first, Loquo was a phenomenon. We were getting at one point 100 calls a week, and maybe 20-30 of them were from Loquo. And best of all, it was free. But at some point, Loquo became too glutted with real estate ads without any effective search or filtering mechanism, and it stopped generating calls.

Other free sites claimed to have hundreds of thousands of monthly visitors, but they never once generated us any leads. They seem to rely on Google ads to make money without offering any real value to their users.

Idealista was also generally quite solid, but not so much as Loquo at first. And, it was a pay service, so that meant that we weren’t quite as enthusiastic about it.

We’d get a solid 15 calls per week from La Vanguardia, a local newspaper, but it was the most expensive single advertising outlet. My agents tended to favor the La Vanguardia clients, because Internet clients tended to be more demanding. They didn’t want any pitch. They don’t want to see 10 other apartments. Their bullshit-detector is on high alert. They just wanted to know if you had the advertised apartment, if it met their criteria and, if it didn’t, they didn’t want to leave their details.

Newspaper clients tend to be more willing to meet up. They are more trusting. They’re not going to do loads of searches on the Internet. They liked it if you did the work for them.

That was our experience, in any case.

And with this combination of marketing outlets, as they sang on the Jeffersons, we were moving on up.

But all of that came to an abrupt end in late 2005, when all of a sudden the market dried up. People were still looking for apartments, but banks weren’t giving out any money given all of the talk (IMF, the Economist, etc.) about a real estate bubble in Spain. They started to ask for double guarantees and to scrutinize mortgage applications more deeply.

But here’s the conundrum: The average Spaniard earns about €1500 a month from what I read in one of the free newspapers. (I say that as a disclaimer.). But the average price for an apartment in Barcelona was about €6000 per metre squared. Assuming that a small apartment in Barcelona is about 40 metres squared, that meant that the buyer would have to pay about €240.000. The Bank of Spain requires that the buyer should have about 20% of the purchase price as a down payment. So that’s €48.000 for a deposit, plus another €24.000 (10% of the purchase price) to cover expenses, meaning that a buyer of a mediocre, small apartment in Barcelona should have about €72.000 in cash to buy a flat — or the equivalent of about 4 years’ salary, assuming that no taxes are paid on the salary and that the buyer has no other expenses (maybe he’s been living at his parents’ home and has no car or social life?). And this means that the apartment should not be in any need of refurbishment and no designer furniture should be contemplated.

And of course, most buyers don’t dream of buying a 40 metres squared apartment. In Spain, they’d rather continue living at home with their folks. Or increasingly, they are moving outside of Barcelona.

For a while banks were offering creative solutions to fix this misalignment of realities, but the Bank of Spain soon got serious and become more vigilant in disallowing lax mortgages. The Spanish economy was at risk.

On top of all of this, a lot of real estate agents are badly trained, accustomed to being able to sell junk to eager buyers — most didn’t have the talent to actually convince someone that a mediocre apartment could be transformed into a dream home.

And, of course, you had all of the clever home owners and investors who refused to accept discounted prices / offers, sure as they were that the prices would continue to grow by an average of 17% per year.

A recipe for disaster, that I must admit, the Spanish government appears to have averted.

The US wasn’t so lucky, because they gave out “no-doc” subprime loans (i.e., you didn’t have to verify the borrower’s income, even though the borrower was a credit risk) and “ninja loans” (i.e., the borrower didn’t have to have income, a job or assets).

But the bottom-line is the same in both countries:

• The real estate market is struggling, meaning that it takes a very long time to sell a home;
• Many real estate agents have had to look for new professions, as commissions are harder to come by; and
• A lot of small agencies have closed, unable to weather the storm.

Real estate is a tough business.

And the key to the whole thing is marketing your portfolio of properties at the cheapest possible price to the widest possible audience. For a variety of reasons, the only options that used to be available in Spain were handmade Xeroed fliers that were placed on cars and expensive but generic ads in local newspapers. And then there are free sites like Loquo, which are cool as long as they don’t become so big and glutted that they lose all value. Or pay sites like Idealista and Fotocasa, which are great values relative to newspapers but not necessarily relative to sites like Loquo (at least from the agency’s point of view).

We are hoping to disrupt those approaches by giving talented real estate agents with a little bit of vision a new opportunity.

For most small agencies, even €300 a month on one portal or on one source that is generating mediocre lists of leads is too much. That’s why our service is free.

We understand that our property search engine will succeed only if we are able to generate real and meaningful leads for real estate agencies and sellers in general, so that we can all avoid the dead pool.

It’s that simple.

eMarketer has an interesting study today of the shift of local ad dollars away from traditional offline yellow pages to search engines in the United States. The argument goes as follows:

• Local offline yellow pages directories are a big market ($12.4 billion), particularly compared to national offline yellow page markets ($2.2 billion).
• Internet yells page directories (IYPs) don’t function as well, because people searching in a phone book go to the business categories as determined by the book’s index. People on the Internet go to search engines and do keyword searches.
• If only 20% of the ad dollars from offline classifieds and directories (a combined $37 billion market in the US) to online classifieds and search engines that would add up to $7 billion of additional local online ad spending in the US alone.

The following chart demonstrates both the current power and future potential of online classifieds and local search markets in the US.

Internet Yellow Pages sites, on the other hand, are expected by most analysts to grow a lot more slowly.

eMarketer notes that not every analyst supports the conclusion that local search will grow more quickly than Internet Yellow Pages.

But it appears to be clear that, regardless of to which destination they might go, people are moving online to find out more information about local businesses, whether in the form of Internet yellow pages, local search, local directories or newspapers online.

It’d be interesting to see the relevant numbers for Europe.

Simon Waldman, Director of Digital Strategy for the Guardian Media Group in the UK, has posted a very insightful presentation about the intersection of the Internet and Web 2.0 on his blog. The text reflects a speech he gave to a German general media audience in Berlin. There is also a pdf version of the script of the presentation.

Simon makes the following arguments:

• Newspapers that want to survive need to embrace, exploit and excel in web 2.0. “There is no denying that our industry — particularly in Western Europe and North America — is structurally challenged, and that is almost entirely down to the net. . . . But I fundamentally believe that newspaper publishers who are prepared to experiment, innovate and invest online will create significant cultural and commercial value as a result of their efforts.”
• Internet moves quickly and probably a lot more quickly than the pace to which traditional media groups are accustomed. “Being online is like having a shop in a mall– you have to keep up with everyone around you, even if they’re not a direct competitor. Otherwise, you seem very tired, very quickly.”
• There are four axes of Web 2.0. “I know that there are all sorts of definitions of Web 2.0, but in my mind there are four key characteristics in the boom: Social networks, search and aggregation, collaboration and video.”
• Google is a frenemy. “Google and its impact on every sector of the economy’s attempt to grapple with the Internet are undeniable — and the newspaper industry perhaps more than most. Some of us see them as a competitor and a stealer of content; others see it as a source of traffic and revenue . . . . [B]ut all I will say is that defining and understanding a relationship with Google and other search players and aggregators is a crucial part of operating effectively in the online world.”
• There’s no turning back, even though most newspaper companies and traditional media groups might wish otherwise. “I wish Google would go back to being a nice, cuddly search engine that does no evil, rather than a global advertising bohemoth. Or at the very least, I wish they had to pay big bucks to carry our headlines and first paragraphs on Google News. I wish free classifieds sites would go away, or that the Internet has recruitment advertisers rushing to spend more rather than less. . . . [B]ut I also know that they are not going to happen. . . . The point is - this is about change. Not a gentle, start of the new school year, kind of change — but disruptive, shifting of tectonic plates kind of change.”

It’s good to see this kind of realistic optimism from the traditional media. There are obviously a lot of synergies between newspapers / media groups on the one hand, and search engines on the other. Indeed has The New York Times as an investor and strategic ally. Simply Hired has News Corp. Yahoo and Google are also increasingly trying to create cross-selling opportunities with newspaper groups.

But it’s also true that when we spoke to some investors initially - and even more recently - people seem to have the concern that search engines and aggregators “steal” their content, rather than they are partners that can redirect traffic to their businesses for less money than traditional media outlets, like newspapers, that charge a lot more for reaching target audiences.

In any case, it seems that the “slow death of newspapers” at the hands of search engines, aggregators and online classifieds sites is in the news a bit this week. Don Dodge has also an interesting post entitled “Online classified ads take $3.1 billion from newspapers,” which is review of an article in the Washington Post about the same topic. The post article is particularly interesting because it examines how vertical search engines such as Edgeio and Oodle are disrupting traditional classifieds businesses.

The bottom line: Search engines and aggregators are here to stay. Not all of us will survive, and most of us will be co-opted or bought. A few may become large, independent IPO-friendly companies. But the technological and economic disruption to traditional media companies can not be ignored or denied.

The Wall Street Journal had an interesting article last week entitled: “Investors to Web Start-Ups:
Where’s the Advertising?” The article mainly traces the experience of Glenn Kelman, who runs an online real-estate brokerage called Redfin Corp. Unlike migoa (or Trulia or Zillow, both of which are also mentioned in the article as advertising-based alternatives to Redfin), Redfin allows consumers to buy or sell homes online. Its model is based not on advertising, but rather on the commision that it receives for each real-estate transaction that it facilitates. The commissions are less than buyers would pay traditional brokers, so everyone is happy.

The main point of the article is that (as Kelman explains): “Today, there’s nothing more fashionable than having an ads-driven model.” So much so that most Silicon Valley analysts told him that he’d have more success if he switched to an advertising model. Kelman is “swimming against the tides,” meaning that he is one of the few Internet entrepreneurs whose business model isn’t based principally on advertising, and for that reason alone, he found it more difficult to raise funds from investors.

Steven Carpenter, CEO Of Cake Financial, makes the same point: “If you have a model that is different from the 90% of consumer-Web companies folks are seeing today … it’s difficult to break through that clutter.”

The logic is clear from the VC’s point of view. The Wall Street Journal explains:

“Venture capitalists tend to be fans of ad-driven sites since advertising revenue theoretically covers the cost of giving away a Web service free, and free sites attract users much faster than sites that charge money. Such sites are typically also cheap to run because there is often no need for customer-service agents or costs for physical goods. So such companies can have high profit margins if they succeed. Many of today’s hottest Web properties are based on the online-ad model, including Google Inc., which pairs ads with search results, and social-networking site Facebook Inc.”

I couldn’t help but think that our experience has been almost the opposite in Spain. A lot of VCs told us that they didn’t believe in an advertising-based model — that it was sufficiently discredited in 2001 — and that we should contemplate a commission-based model that would be secure. We kept telling them that serious money is being made based on advertising models, but many seem to believe that Google’s success is a fluke.

For me, the key question is: How do you build traffic? If you are available to create a product that can generate interesting traffic numbers, the money issues should resolve themselves in the mid-term future.

After all, online ad spend is growing at monster rates, with no apparent decline in sight. Many traditional media sectors, on the other hand, are in decline or at best growing very modestly.

In any case, let’s not cry for Kelman and Carpenter just yet. Kelman eventually raised $12 million in funding, and Carpenter also received VC funding.

OK. So I’m trying a new experiment that goes against my nature.

I’m going to try to write shorter posts.

Carlos and Albert have told me that my posts are a bit long, particularly for non-native English speakers. I like to think of my posts as stream-of-consciousness mini-essays, but it seems that in this Twitter-generation, I might be a bit antiquated, lost in my fond memories of being an eager college student at Yale.

So for today, I’ll try the short post thing, which suits me just fine, because today is Monday and Monday is the toughest day of the week, particularly in August when everyone one else is at the beach and you’re in the office working.

So getting to the point: MarketingDirecto.com has a good summary of a study published by Edison Media Research discussing the changing perceptions about the importance of newspapers versus the Internet in the United States:

• 1/3 Americans (referring to people from the US) think that newspapers are the least important media format (relative to TV, Internet and radio).
• Only 10% of Americans think that newspapers are important.
• 33% of Americans think that the Internet is important vs. 36% that think that television is important.

In short, Internet is catching up to TV (traditionally, the most important medium), and newspapers are in danger of becoming irrelevant.

It’ll be interesting to see how the newspapers respond to this threat. In the late 1990s, it seemed that they mostly ignored it, fueling the rise of companies like Rightmove, Idealista and Seloger. This time around, I don’t think that they have that luxury, at least based on their annual reports and other corporate documents that show negative growth numbers without any optimistic future outlook.

It’ll also be interesting to see how television companies will respond. The BBC has demonstrated one approach with its iPlayer. But I’m sure this is just the tip of the iceberg.