The cost of the scanning, an estimated $50 million so far, is far less than the cost of the copyright lawsuit settlements, an estimated $125 million so far.   These figures don’t include the data storage cost of these millions of volumes, which can’t be cheap either.  So why do it?

To protect the world’s cultural heritage?  Books, by nature of their paper ingredients, make them attractive prey for fires.  Google co-founder Sergey Brin points out the ancient Library of Alexandria burned down three times, and our own Library of Congress lost two-thirds of its collection in an 1851 fire.  With today’s digital storage technology, don’t we owe it to posterity to preserve the accumulation of mankind’s writings?

While that’s an admirable goal and sounds nice in the press release, the truth is Google wouldn’t go through the trouble and expense if they didn’t plan on making money from the project.

Of course Google shows its bread-and-butter text ads next to all the book search results.  Critics argue that its one thing to archive all the books of the world for future generations and for easy indexing online — the digital equivalent of a card catalog, right? — but quite another when you intend to profit off someone else’s copyrighted work.  As part of one of Google’s legal settlements on the project, they’ve had to agree to generous revenue-sharing percentages with the authors and publishers.

Also in the works is a digital download e-store, which will likely compete with Amazon and their Kindle-books.  No word yet if Google will develop their own reader hardware, or if the downloads will be in an open format to work on the Kindle and others.

I think it will be interesting to see how the Google Books project progresses.

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A Timeline

April 2007 – Google acquires DoubleClick, and all it’s subsidiary businesses including Performics, the affiliate marketing network.  Conflict of interest, anyone?

June 2008 – Google rebrands Performics as the Google Affiliate Network (GAN).

October 2009 – Google integrates the publisher payment platform for GAN with their payment platform for Adsense.

Adsense is the division of Google’s business that pays website owners to host Google ads on their website, like the kind that used to appear just to the right of this post (more on why they’re gone later).  What does that have to do with affiliate marketing?  Absolutely nothing.

For most publishers, linking their Adsense and GAN accounts was a non-issue.  For me, it took just a couple minutes.  But for others, it was impossible.  And with Google leaving not a single other payment option, these publishers were kicked out of GAN on November 1st.  Some sort of perceived policy violation (click-fraud, for example – maybe these users clicked on one of their Adsense links once to test if it worked 5 years ago…) prevented them from being able to link accounts.  In the vast majority of cases, I think it would be difficult to prove any pattern of “criminal intent” on the part of the publisher.

And from what I’ve heard, there is no recourse.  You can appeal but no one will ever hear out your case.  There’s no number to call, no human interaction, you’re just screwed.  It’s management by algorithm, which as we’ve seen can both be incredibly smart and terribly stupid.

Google is excited to gain efficiencies by only having one payment system.  And they’re excited because now they get to hold publishers’ money an extra 30 days before paying them.  They’ve even come out and said with pride that the transition to the Adsense platform was a resounding success, with only 1% of publishers being unable to link accounts.  That 1% is an acceptable amount of collateral damage to the company with a market cap of $170 billion.

But to the 1% — the small businesses that relied on income from GAN advertisers — it was a devastating move.  To have their long-term relationships with advertisers severed by Adsense (again, completely unrelated to affiliate marketing) is absolutely brutal.  And terrible business for all parties involved.  Remember, Google makes a fee on every affiliate transaction, so they’re hurting themselves too.

The affiliate relationship is one between the advertiser and the publisher; the job of the network is to track sales and keep everyone honest.  In ending these mutually beneficial relationships, Google has clearly over-stepped the bounds of their responsibility.  It’s lose-lose-lose.  The advertiser loses sales from productive affiliates they approved to promote them, the publisher loses income since they can no longer promote GAN advertisers, and Google loses the network transaction fee on all those potential sales.

To protect myself, I’ve removed Adsense from all my sites.  The risk of setting of their alarms, maybe even by a competitor with malicious intent, isn’t worth it.

I can’t understand why a company that purports to be so smart and benevolent can be so unresponsive after making these arbitrary decisions that hurt all their customers.  If they’re so concerned about letting these publishers into Adsense, why not let them open an affiliate-only version of it just to collect affiliate payments and disable the actual Adsense code.  I bet one engineer could figure out how to do that in less than a day.  But then again, that would be management by reason, not management by algorithm.

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Last summer was kind of stressful.  After careful consideration, and 2 years of Internet-business income history, I decided to quit my job (salary, benefits, company car, all gone).  The very next day, Google decided my site was “poor quality” and “irrelevant” — and would no longer let me advertise with them.  Given my reliance on search-advertising, and their near-monopoly position in that arena, this was devastating news.  All of a sudden, what had been just fine for the last 2 years wasn’t good enough anymore.  The traffic plummeted and the sales I’d planned to replace my salary with fell off a cliff.

Their reasoning was this: my site provided a poor user experience, that, allowed to exist over the long-run, would lead to fewer customers clicking on Google’s ads, meaning lower profits for them.  Simple enough in theory, only they failed to see that the pages were highly relevant or take into account the thousands of happy customers my site served each month.  Would the customers really have bought all those shoes if the experience was so poor?  It should be self-policing; why would I waste money sending customers to pages they didn’t want to see?

Before the economy tanked, nearly half of all online shoppers reported using a comparison shopping engine to help find the best deal.  Over the last year and a half, I can only imagine that figure is much higher.  In shutting me down, Google made it harder for shoppers to find information they have been proven to seek and value.  At best, it makes you wonder how they interpret their own famous “Don’t be evil” code-of-conduct, and at worst, they open themselves up to restraint of trade allegations.

In shutting me down, Google lost a 5-figure-a-month revenue stream, which would be impossible to justify to shareholders.  Let alone the unknown ranks of other advertisers that suffered the “Google Slap.”  (Yes, this apparently is common enough it has been given an official name.)  As a publicly traded company, it’s clear Google cared more about their own agenda than maximizing shareholder value.  Are there other companies making so much money, they feel like they can turn it away?  Normally that wouldn’t be such a big deal, but when Google does it, the result is searchers only get to see what Google wants them to see.

Don’t be evil?

After three months of pain, lost-sleep, tweaking the landing pages, and begging for reinstatement, I got a note from Google admitting “there was an error” in evaluating my quality score.  Better believe I printed that email and put it in a safe place!  It only took them 90 days and tens of thousands of lost dollars to admit they were wrong.  But at least they did.  And just as quickly as I’d been turned off, I was back in business with “Great” and “highly relevant” pages.  They’ve willingly accepted my ad dollars again for almost a year now.

And such is the backstory of my love-hate relationship with big G.  Can’t survive without ‘em, and have to play by their rules.  As their search market-share creeps higher each month, we should all start to think of the implications of one company controlling so much of our access to information.  If this site is gone tomorrow, you’ll know why.

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The other side actually had a real car key taped to it, along with a picture of a new Ford Focus and a Mercury Mariner, saying if your key opens the car, you win it, no strings attached!   Since dealers are required to list stock numbers in ads like these, you can look up the inventory online … and to my surprise, both vehicles were actually in stock.

The mailer also advertised 2 cars to be sold for $88 dollars.  A 1988 Towncar and an early 90’s Saturn.  For that price, there’s plenty of cash left over for rims.

Aside from the possibility of winning the cars, you could also win $10,000, a big screen TV, a diamond tennis bracelet, an iPhone, or a vacation for two.  There was a scratch-off section on the flyer that revealed 3 diamonds.  OMG did I win the diamonds?  I know a special someone with a birthday coming up!

Having worked in the car industry, I knew better.  But I kind of wanted to see what it looked like to the average customer who thinks, “It’s probably too good to be true, but what do I have to lose by going in?”  That, and I was due for an oil change.

So I didn’t win either car.  No surprise there.  But the diamonds from the scratch off game?  The friendly contest rep (who I believe actually worked for the marketing company, not the dealership) informed me, “Diamonds mean you won the vacation.”

At this point he takes my flyer (so I couldn’t take a picture…should have thought of that beforehand) and replaces it with one from Worldwide Travel Center that details how to go about claiming my 3-day, 2-night dream vacation.   It takes all of 2 seconds of reading the fine print to see that this company is a huge scam, as the first page of google search results will attest to.  Terms and conditions: “1. This mail-in offer provides accommodations for two (2) adults, at least one of whom must be gainfully employed.”

Hmm, interesting that a company that’s offering free travel and that’s “not a timeshare” would care about the income level of it’s customers.  I didn’t read all the Ripoff Reports on these guys but it’s clear they’re super shady.  They could really use some online reputation management help.

Speaking of reputation management, it’s easy to see why car dealers have the reputation they do when they run promotions like this.  Think of the message they’re sending to potential customers, customers who’ve already made the effort to physically come to the dealership.  They’re led to believe they won diamonds and instead get this fake vacation package from some travel company that leads the league in scam complaints.  Business is about trust, and I’m afraid this dealer just cost himself a lot of trust in the community.  But I’m actually OK with that.  Marketing is marketing and if that’s how they want to it, that’s fine.   Hopefully they sold some cars and made some money to make it all worthwhile.

Which leads me to the real problem I had with the whole experience: the complete lack of effort to try and sell me a car!  Not that I was going to buy one, but I definitely expected a little back-and-forth.  If I was the owner I would be pissed!  If you’re going to play the bait-and-switch game, at least play it well!  The whole idea of these mailers is to get people on the lot to have an opportunity to sell them something.  Like I said, they were really well-done flyers (in that scammy sort of way), and I’m sure they were really expensive.  And the sales staff was blowing it big time.

I wandered the showroom for 15 minutes with not one sales rep greeting me.  I finally went to the sales manager’s desk and asked how I could find out if I won the car.  He introduced me to a salesman who — and I mean this in the nicest way possible — didn’t appear to be all there in the head.  We had about a 100 yard walk to the used car lot where the contest was being held… no attempt to build rapport, ask what kind of car I drove, what my payments were like, what I thought of the new models, nothing.

Then after discovering I didn’t win the car, he has me sit down in the waiting room to see the contest rep about the diamonds.  And then he left.  Are these people no longer paid on commission?  Seems like some basic sales training could go a long way.  Because for all the fancy mailers and showroom traffic they generate, nothing happens until somebody sells something.

But there’s hope in the form of a lesson from online marketing.  In the online world, landing pages are your “salespeople.”  Those are the pages a customer first sees after clicking on your link or ad.  They are endlessly tweaked and optimized for maximum performance.  And there’s no reason real-life sales teams can’t be optimized in a similar way.  If some method or personality doesn’t produce, try something or someone new.  Once you generate some positive results you can keep tweaking your process until it becomes a well-oiled machine and your closing rates are the envy of your peers.

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On the Internet, a good domain name is the online equivalent of that corner lot in the neighborhood with good schools.  The problem is, all the good names are taken and only “fixer-uppers” are left.  That’s why you have companies called Flickr, Rowdii, Weebly, and Sedo — which auctions off domain names to the highest bidder.

Did You Know?

• According to GoDaddy.com, there are 456,976 possible 4-letter .com domain names.  Of those, only 0.7% remain unregistered.
• Sex.com holds the record for the most expensive domain name ever. It sold for $14 million in 2007.

“Domaining” is the art and science of domain-name speculation.  It turns out that online real estate is much cheaper than the real thing: you can register domains for under $10 a year.  And with the potential to strike it rich by selling to some individual or company with deep pockets, it’s easy to understand the appeal.  No lawns to mow, no rent to collect, only 1’s and 0’s in the ether.

But those kinds of large price tag sales are rare.  A more common way to monetize your domain is to place some text ads or directory ads that look like search results.  Most of these worthless sites won’t show up in Google’s index, but instead rely on “type-in traffic” — where the user just types the domain name into his browser to see what’s there.  For more obscure names, traffic is undeniably low, but it doesn’t take much to cover your cost.  And for a common misspelling of a popular site, it could be a big moneymaker.

I haven’t played these games, but do own a handful of domains.  Most are bookmarked for future projects.  Some I’ll let expire when I realize I’m never going to do anything with it or when I think of a better one to replace it.  My favorite?  BetterThanDuctTape.com is going to be your future source for all spare car parts.

Dot-coms are much more valuable than dot-nets, but it’s hard to quantify how much more valuable they are.  The owner of shoesrus.com had an idea: $5000.  That was three years ago when I said, “no thanks.”  I’ve made a number of attempts to contact him since to make a counter-offer but haven’t had any luck.  Oh well, you live and learn on your first big project.

One of my first domains was NJLEnterprises.com, a quick site built in college for my company at the time.  After moving across the country and changing company names, it had fallen out of use.  Then some guy called me randomly one day and wanted to by it for $100.  Deal.

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Last summer for example, I fell victim to the “Google Slap” and lost 75%+ of my traffic and revenue for three months.  Stressful.  Hopefully we’ll stay on better terms this summer… maybe I should have bought something from their gift shop.  Either way, that’s why I’m working on diversifying the business and investing for the future.

I miss the people I used to work with, and my company cars.  But the work itself, not so much.  The self-employed lifestyle affords too much freedom to go back.

With any luck, I’ll be able to add a “Celebrating Two Years of Retirement” post next year.  But I’m probably jinxing myself by writing this, so until then, I’ll just take it one day at a time.

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• When I first pulled up, I passed parking spots for carpools and expectant mothers, and found an open space amid a sea of Priuses.  I had to check around to make sure I wasn’t in some “hybrid-only” area.
• The visitor check-in system is completely automated.  You type your name and who you’re visiting and Google’s computer instantly pings your Gmail storage usage, your AdWords spending, your Blogger posts, your Adsense and Google Affiliate Network earnings, and your Picasa albums to determine if you’re worthy of a namebadge sticker.  Whatever top-secret algorithm they use, it worked and printed me out a sticker.  There were receptionists, but I think they are only there to refill the printers when they get low.
• There’s free food everywhere!  There were so many choices for lunch it was almost like being back at the Wynn buffet.  If I worked there I’d be obese for sure.
• Nobody is obese.  Probably because of the high-class on-site gym, beach volleyball court, loaner bikes, and infinite pools.
• Like any good tour, we were sure to made a stop at the gift-shop, a “beta version” of an offline store filled with Google swag.  I didn’t buy anything so they docked a few MB’s off my gmail account.
• I didn’t see anyone over 35 years old the whole time.

All in all, the Googleplex definitely looked like a cool place to work.  It was the exact opposite of any Ford office I’d ever been to.  And it was nice to see they’re putting my advertising dollars to good use, feeding thousands of smart hungry Silicon Valley youth each day.

And I’m just one small cog in their massive, ridiculously profitable money machine.

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I was thinking I better put this on my to-do list for Monday, but then noticed some fishy elements to their letter:

• A Los Angeles address at the bottom, instead of Sacramento
• A 213 phone number, instead of 916 of 1-800
• A request to make check payable to “Annual Review Board” instead of the Secretary of State or Franchise Tax Board.
• A section in bold stating this “service has not been approved or endorsed by any Government Agency.”

At that point I did what I imagine anyone would do these days.  I googled “Annual Review Board Scam?” and found out that indeed this was a scam letter. Oh the power of the Internet.  If the Annual Review Board wants more people to send them their money, they need to work on better SEO and bump all of the websites denouncing their service off the first page of search results.

For full disclosure, filing a Statement of Information is a requirement every two years.  But you can file directly with the Secretary of State for free, rather than paying this shady outfit $228 to do it for you.

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Yesterday I learned the hard way the value of taking a break.  At some point in the afternoon I created a Google ad for a pair of shoes that had “ska” in the name.  Not wanting the ad to show for people looking for info on ska music, I intended to add “music” as a negative keyword –meaning the ad won’t show for anyone who includes music or something similar in their search.  But in my rush, I carelessly forgot the minus sign (to indicate the keyword was supposed to be negative).

I came back after dinner to see some crazy numbers in my advertising account.  In just a couple hours, close to a million people had searched for “music.”  And while only 1/20th of 1% clicked on my misplaced ad, I was still out $95 before I could correct it.  This is a great example of how easy it is to get burned by Google if you don’t know what you’re doing.  There is no room for error.  Today I’ll be more careful!

On a side note, it could have been much worse.  At the Affiliate Summit in Vegas, one speaker told a story about how an innocent forgotten decimal cost him $5000 before he even noticed.  Yes, there’s a big difference between $0.80 a click and $80 a click.   Goes to you show you if you play with fire long enough, you’re bound to get burned every now and again.

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While the book had a few interesting tidbits, it was mostly filled with less-than-insightful passages explaining why our collective intelligence can actually be pretty smart.  For example, it doesn’t seem too surprising that a large group can fairly accurately estimate the number of jelly beans in a jar.

Surowiecki offers up Google’s algorithm as a perfect example of the wisdom of crowds in action.  Google couldn’t possibly sort through the billions of webpages it indexes and rank them in a fraction of a second all by themselves, so their algorithm looks at what sites are linking to other sites for particular keyword phrases.  Each link counts as a vote, with links from “higher-value” sites weighing more heavily.

But I’m skeptical as to how wise crowds really are. After all, it was a crowd that trampled a Wal-Mart employee last Christmas in search of a bargain TV.  And it was a crowd that voted to take civil rights away from their fellow citizens.  The book doesn’t address these kinds of collective failures, but does talk about market bubbles and the perils of “group-think.”  To be truly wise, members of the crowd need to be diverse and act independently.  So break away from the crowd that thought this was an awesome book and skip it.

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