Posts tagged ‘Michael Arrington’

A New Business Model Fuels the Decline of Tech Reporting

I just finished reading through a post by Dan Lyons. Lyons goes over the top at times, and the title gives a clear hint at the tone — “Hit men, click whores, and paid apologists — welcome to the Silicon Cesspool.”

There is a lot going on in this post. To get the full picture be sure to click through the links, especially the NY Times piece that discussed the mobile social media service Path uploading user address books without their knowledge. I’ve also read the attacks on the NY Times reporter by Michael Arrington and MG Siegler, former partners at TechCrunch and now at CrunchFund. CrunchFund is an angel investor firm and one of their portfolio companies is Path.

Lyons strongly dislikes Arrington and Siegler, and they him. The invective can be fun to read, but also a little distracting.

Lyons does a good job laying out the business model behind CrunchFund, and the inherent conflict of interest in covering firms you’re invested in. I also like the parallel made to the pay for play analyst firm approach from the first tech bubble days. I remember that well from my Advertising.com days and it’s an apt analogy.

Siegler makes some good points regarding the decline in technology reporting. He is a highly dubious source of such commentary, however. He cashed in at TechCrunch, succeeding via the same tactics and attitudes he now claims produces technology reporting that is mostly BS.

That stipulated, many of his points sound accurate to me about what is happening. The focus on pageviews not research, the impossible number of stories published daily, the greatly expanded coverage beats and the huge contraction of media sounds right to me. I’ve heard the same from trade reporters I respect and have known for years.

In his post attacking Nick Bilton the author of the NY Times article, Arrington fully assumes the investor mentality.  He calls public opinion a mob, and despairs that companies are forced to issue apologies when business practices create controversy. Somehow VC backed companies are the victims here, and changing course in the face of consumer feedback threatens innovation.

So where does all this leave us? Regarding Path, I’ve written extensively about the need for transparency around today’s online quid-pro-quo. Personal information is traded for fun and useful online services. This deal simply needs to come out of the shadows, and most consumers will accept it. If startups want to avoid the “mob,” as Arrington describes it, this is a simple way to do it.

Regarding tech reporting, the model Arrington and Siegler have set up does not bode well for the future. In addition to all the existing challenges facing tech reporting, there is now a business model being tested for how to monetize becoming an influencer. Should this model succeed, it can only further erode the objectivity and quality of reporting by anyone who aspires to follow in CrunchFund’s footsteps.

Of course Arrington and Siegler are free to use their influence any way they want, and their new business model is compelling when viewed purely from a financial perspective. It’s just not good for the rest of us.

February 19, 2012 at 11:14 am Leave a comment

Jerry Yang Hatred Reaches Hysterical Levels

It’s been a few days since Microsoft reportedly walked away for good from discussions with Yahoo, and the vitriol being hurled at Yahoo CEO Jerry Yang is really something to behold. There certainly are facts to back it up, but the uniformity of the conventional wisdom and the level of anger puzzles me. Some of the coverage has taken on a very personal tone.

You can easily picture the veins bulging as Michael Arrington at TechCrunch screams Yahoo can’t possibly make more mistakes:

http://www.techcrunch.com/2008/06/13/massive-destruction-of-shareholder-value-employee-morale-and-internet-health/

Joe Nocera in the NYTimes rips into Yang and accuses him of violating his fiduciary duties and “stiffing” shareholders: http://www.nytimes.com/2008/06/14/business/14nocera.html?_r=1&partner=rssnyt&emc=rss&oref=slogin

Kara Swisher at All Things D already has a list of possible successors prepared:

http://kara.allthingsd.com/20080617/boomtowns-short-list-of-yahoo-ceos-sorry-jerry-but-fortune-favors-the-prepared/

Each executive departure is shown as proof of internal chaos — even when people like Jeremy Zawodny go out of their way to deny any connection:
http://jeremy.zawodny.com/blog/archives/010336.html

So what’s wrong with the conventional wisdom? Seems to me it’s focused too much on stock watching, assumes a merger with Microsoft would be successful and would curb the dominance of Google, and can’t conceive of the status quo changing. Let’s take those quickly in order:

  • Didn’t techies used to complain about business types obsessing over quarter to quarter numbers, and failing to see the need for the long-term view? And do the shareholders of Yahoo need Michael Arrington to go into a frenzy on their behalf? Investment comes with risk. If you don’t like how a company you’ve invested in is performing, you sell the stock.
  • A majority of mergers fail. Everyone knows this, many forget in the excitement of mergers and acquisitions. Poor planning, executive distraction, culture clashes and an internal focus on integration that hurts day-to-day performance are just some of the common causes. And is there any proof that Microsoft and Yahoo today exerting any moderating influence on Google’s rates? If not, then why assume a combined MicroHoo would?
  • To think the status quo can’t be changed is showing a lack of faith in technology and innovation. Who saw Google coming when Goto.com first started offering bids for search ad placement in 1998? Will no company ever challenge Google? And this view is very North America centric — in other global search markets Google has nothing like the share it has here. Internet growth is fastest in areas like China, where the search engine Baidu.com reigns supreme.

So I’m not totally alone on this ledge, a couple of interesting posts. Tim O’Reilly talks about an Internent Operating System of which search is just a piece, and encourages Yahoo (and Microsoft) to find new ways to excel:

Meanwhile, Yahoo! has let itself be defined by the same kind of penis envy. Here is a business that has beaten Google in area after area, that is unquestionably the #1 media company on the net, and yet has let itself be defined by the one area in which it is #2 — and where it could be much more profitable and successful by partnering with #1 than by competing with them.

http://radar.oreilly.com/archives/2008/05/microhoo-corporate-penis-envy.html

And here’s a good read from Bernard Lunn of ReadWriteWeb, where he outlines 11 areas of possible opportunity around search:

My first post for ReadWriteWeb (nearly a year ago) started with the premise that search was “game over”, that Google had won and the only opportunity left was (re)search – i.e. what one does after the basic search. Unfortunately, none of the search start-ups since then has made a dent in Google’s relentless march towards search market dominance. In this article, we outline 11 search trends that may change that.

The proposition that launched countless search start-ups was: “If we can get just 1% of the search market, we will have a very valuable business”. That may be true, but getting 1% has proved elusive. It has been an all or nothing game. That may be about to change.

It is possible that Google will not be beaten by one big competitor. It is possible that they will be pecked at by thousands of tiny start-ups using a new outsourced infrastructure.

http://www.readwriteweb.com/archives/11_search_trends.php

None of this means Yang is necessarily the right guy for the job — he could be gone very soon under the avalanche of negative coverage. Unlike Kara Swisher, I’ve never spoken to him and can’t give an opinion on his abilities based on first hand knowledge. And unlike Michael Arrington I’m not on the speed dial of every disgruntled Yahoo exec with a juicy leak. (maybe someday this blog will get there…)

The reporting around the poison pill that was rushed through to make any MS acquisition harder sure sounds bad. A shareholder suit has been filed, and time will tell on that front. But it would be nice if some of the reporting allowed for the possibility — just the possibility — that Jerry Yang understands the company he founded and can lead Yahoo to success on its own.

UPDATE — Awesome, Danny Sullivan of Search Engine Land agrees! Of course he writes a more thorough and detailed post:

Yahoo The Failure — Myth vs. Reality: http://searchengineland.com/080620-094239.php

June 18, 2008 at 3:26 pm 1 comment


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