GenuineVC David Beisel's Perspective on Digital Change

March 31, 2005

The acquisition of Ask Jeeves by Barry Diller’s InterActiveCorp (IAC) two weeks ago got me thinking about the question and answer model that the company originally tried to use to differentiated itself. That approach really never took off, and the company eventually shifted its attention to other aspects of the business (which yielded them a consolation prize of $1.8B, not bad when compared to say About.com’s recent $410M sale).

But it got me thinking. Is the “question and answer” paradigm really dead? It looks like a number of start-ups are trying it again. This time one of the spins is on having users generate “microcontent” responses, as opposed to having search results or experts/guides respond to you. At first glance, it sounds like the social networking sites have rubbed off on search.

But, I think that there is could be a new diamond in the old rough here. My belief is that the timing is right for a microcontent producing Q&A sites (in investments in them) to flourish now, whereas it couldn’t in the past, for a number of reasons:

1. Publishers’ eagerness in seeking additional quality content to increase their available advertising inventory. Since the bottoming out of online advertising market after the bubble, the past few years have produced renewed fundamental advertiser demand for online media. This situation has driven up media prices, inducing publishers to actively seek new content to sell under their brand umbrella.

2. Google’s AdSense and other contextual networks facilitating monetization. With the presence of AdSense and other contextual advertising networks, microcontent publishers now have a genuine ability to monetize their information pieces in a way that wasn’t available during the late 1990’s.

3. Improved search engine algorithms facilitating increased sophistication of consumer information searches. As search results have greatly improved in the past five years, consumers are more comfortable and likely to search for specific, detailed (i.e. microcontent) information – rather than just general topics.

4. Adoption of new content syndication technologies like RSS. With expectations of full RSS embracement, there will be an accepted protocol which facilitates the syndication of microcontent that wasn’t available just a few years ago.

5. Renewed interest by major portals in social input engines. Signaled by both acquisitions and in-house developments, the major portals (namely Yahoo), have recently devoted significant attention to online models that leverage a collective social input aspect in generating content (dating sites, Yahoo360, Flickr).

I’ll keep ruminating on this one and see if I can find other opinions on the blogosphere that agree or disagree. I haven’t seen much discussion about it in the blogs that I regularly read.

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  • Rob Go
     - 4 hours ago
    So, main lesson. Founders of great companies don't get too excited when momentum is high and fight ferociously when times are tough
  • Rob Go
     - 2 hours ago
    RT @joshk: I can't wait to see @MagicLeap. (They raised more money in this one round than @firstround has invested in 10 years across 250+…
  • Rob Go
     - 4 hours ago
    Also important to keep in mind that a lot of great companies struggled in the valley of death but fought their way to the other end
  • Rob Go
     - 4 hours ago
    RT @adamnash: When markets fall, you are not an idiot. When markets rise, you are not a genius.

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