Wednesday, December 07, 2005

It's all about the Mawsons

Whenever my mother asks about how Tinfinger's going, she never fails to slip in a quick question along the lines of: "... so have you made any money yet?" Cripes, I swear she is obsessed. (Hi Mum!)

It's a fair question nonetheless, and the issue of revenue sources for companies like mine has been raised many times recently as some start to get over the gee-whiz phase and start to wonder whether any of them are sustainable. Dave Winer calls Google's advertising-based strategy "a temporary transitional thing", and Dion Hinchcliffe ponders the overdue arrival of innovative monetisation techniques.

I am skeptical of the skepticism of those who say advertising is a short-term bubble. Quite apart from the stark reality of Google's numbers, you only have to look at the research suggesting that the market still has a lot of room to grow, especially considering the percentage of leisure time people spend online is far ahead of the proportion of spending by advertisers on the Internet.

Most of the critics of online advertising's potential are (a) programmers, and (b) well-off old men. Well-off old men don't like being advertised at because they've bought everything they think is worth buying already. That doesn't mean other types of people don't accept advertising as part of the media landscape - particularly online where the ads are far better targeted. Some programmers seem to think no content at all should be monetised. In this make-believe world of mass amateurism, content should be completely free and all we pay for is software (although a subset, most of whom are also well-off old men, think we shouldn't pay for that either). This is a minority view, held only by people who have already made their fortunes... in software. In the real world, people can and do expect to get paid if they create content that a large number of people want to experience.

Having said all that, I'm not sure advertising is going to help Tinfinger all that much. In particular, I don't think keyword-based advertising will work very well for pages based on names. Maybe if Tinfinger (or sites like it) take off then names of famous and semi-famous people will become hot property on Google AdWords and its equivalents, but at the moment I'm not seeing it.

That means we will have to think up new new things to sell. The thinking I've had along these lines is based on the experience of The Footy Show. For those of you who don't know what that is, it's a television program about Australian Rules football, but for many years at the start of its existence, it didn't have the rights to show any footage of games in the AFL, the main league. The producers of the show turned this negative into a positive by making the show about everything that happened outside the ground, especially about the personalities in football. Although they didn't have rights to use any of the intellectual property of the AFL, they effectively created their own IP around the game, and ended up being the dominant show about the AFL outside the actual game broadcasts (and often more popular than those, too).

That model is one that Web 2.0 companies would do well to emulate. Most of them don't own their own data stores (like mashups), or at least are largely based on others' data (like aggregators). All most of them own is their userlists. My theory is that like The Footy Show, Tinfinger can use a bit of lateral thinking to devise its own products that do not use the IP of other sites, but relate to the same things that the other sites are covering, with the assumption that your users are familiar with that content because they have visited those other sites (probably through your links or mashup code).

What that will mean in practice will be different for each site. Tinfinger's focus is on people, so there are a bunch of opportunities waiting for us on that front. Or so my mother is hoping.

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