FTC Lets Google Off The Hook In Search Competition Case

Image representing Google as depicted in Crunc...

Image via CrunchBase

From my Forbes.com blog The New Persuaders:

In a case that some people thought echoed the Justice Department’s landmark antitrust lawsuit against Microsoft in the 1990s, the Federal Trade Commission today announced it has closed its case against search giant Google. The upshot: Google essentially got off scot-free on the key issue of its search practices.

The deal concludes that the key issue that would have potentially rewritten how Google does search–whether the company engaged in unfair competitive practices with its industry-leading search engine–was not sufficient to require Google to make any changes, let alone pay any fine. Instead, it requires the company to take only voluntary measures that likely won’t have a significant impact on Google’s business. From Google’s own blog post on the deal:

  • More choice for websites: Websites can already opt out of Google Search, and they can now remove content (for example reviews) from specialized search results pages, such as local, travel and shopping;
  • More ad campaign control: Advertisers can already export their ad campaigns from Google AdWords. They will now be able to mix and copy ad campaign data within third-party services that use our AdWords API.

In a somewhat more significant part of the deal, Google also agreed to make its standards-essential patents available on so-called fair, reasonable, and non-discriminatory terms without using injunctions to block their use by rivals.

Again, from Google:

In addition, we’ve agreed with the FTC that we will seek to resolve standard-essential patent disputes through a neutral third party before seeking injunctions. This agreement establishes clear rules of the road for standards essential patents going forward.

Here’s more from the FTC release: …

Read the complete post at The New Persuaders.

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How Did I Do On My 2012 Predictions?

2012: The Year Ahead

Photo: Mike Licht, NotionsCapital.com

From my Forbes.com blog The New Persuaders:

It’s that time of year: time to reflect on the past year, time to get wasted and watch a glass ball smash into the ground, time for people like me who foolishly offered predictions for the past year to face the music. So here’s how I did on my 2012 predictions:

* Facebook goes public, but won’t start an IPO landslide: Bingo! Indeed, Facebook’s ill-received IPO led to a months-long drought in IPOs as investors realized they were not a sure route to riches. The situation may be improving, but mostly for enterprise more than consumer companies.

* Facebook’s ad business booms–but not at Google’s expense: Bingo! While Facebook’s revenues slowed even before its IPO as it continued to experiment with new ad formats and scrambled to provide mobile ad units, ad revenues have since accelerated, up 36% in the third quarter over last year. At the same time, while Google’s revenue growth disappointed investors in the third quarter, it was mostly thanks to the impact of its Motorola acquisition, not a shortfall in its core ad business.

* Image ads finally find a home on the Web: Half-right. YouTube proved there’s a real market for TV-like video ads if you give viewers the choice to view them or not, as its revenues were expected to hit $3.6 billion in 2012, according to Citibank. But Facebook’s struggles to attract brand advertising despite a TV-scale audience, while partially successful, show that no one has yet come up with brand ad formats that work consistently and at large scale online. Or at least brands, which still spend most of their money on TV ads, don’t believe it yet. And they write the checks.

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Calling Dick Tracy: Will Apple Really Launch An iWatch? Very Doubtful

dicktracyFrom my Forbes.com blog The New Persuaders:

Even in a holiday week, the Apple rumors continue–and today, it’s that the company may produce a smart watch in the first half of next year.

Yes, another techie watch, the bane of the technology industry nearly since the dawn of the microchip. Here’s why I’m not betting on seeing an iWatch anytime soon:

* We all already carry a watch. It’s called a cell phone. And in case you hadn’t noticed, it can tell you the time–more reliably than you can make a call on it, in fact.

* Even Apple would have trouble making a watch with a screen look fashionable enough to wear all the time. Seriously, half the population will never wear anything like this, and I’m betting that even most of the male half would look askance.

* Anything with a screen that would fit on your wrist is too small to do the vast majority of stuff you can do on a smartphone. Don’t even think about anything resembling a keyboard, and Siri isn’t nearly there when it comes to voice commands for a wide variety of applications. The screen also would be too small to run ads on, which, come to think of it, might be a plus for Apple as a way to stick it to Google.

* Apple supposedly isn’t designing this thing. According to the report, Intel would design the watch and Apple would produce it. Sorry, no. Only in the Bizarro universe would this kind of thing happen.

All this is not to say that Apple won’t move into wearable computing at some point. …

Read the rest of the post at The New Persuaders.

Google Cuts ‘Fat Finger’ Accidental Clicks On Mobile Ads

gmobileadFrom my Forbes.com blog The New Persuaders:

Advertisers have long known about a problem with mobile ads: fat fingers.

That is, people accidentally click an ad on those little smartphone screens thanks to clumsy digits (or purposely big or hard-to-avoid ads). Realizing their mistake, they back up instantly, but the advertiser gets charged while getting only a wisp of attention from a consumer they probably didn’t want to reach anyway. Today, Google is introducing a tweak to in-app image ads that should reduce those unintentional clicks considerably.

It’s a big issue. Recent studies indicate that up to about 40% of mobile ad clicks are accidental or even fraudulent, based on the fact that people “view” the ad two seconds or less. The result, of course, is not only that advertisers get charged even though consumers had no interest in the ad, but that they obviously aren’t going to end up buying the product or service.

This may be one reason advertisers pay much less per impression for mobile ads. And that’s a problem that has investors concerned about every company from Google and Facebook to a raft of mobile and app startups, as more and more online activity moves from stationary computers to smartphones and tablets.

Google found most of the accidental clicks on app image ads happened at the outer edges of the ad, no doubt because people were trying to scroll up or click on adjacent content. So now, Google has added a prompt to “Visit site” whenever people click on the outskirts of the ad. It’s an extra click, but it also ensures that’s really what the person wanted to do. …

Read the rest of the post at The New Persuaders.

Here Are The Top 20 Ads You Actually Chose To Watch On YouTube This Year

From my Forbes.com blog The New Persuaders:

 

A big reason YouTube has been on a roll lately, due to hit $3.6 billion in gross sales this year, is its TrueView ads that advertisers pay for only if people view them at least 30 seconds. At least 65% of ads inside videos use this format now.

So what did people choose to watch this year? YouTube this morning revealed the top 20 most popular ads of 2012. The YouTube Ads Leaderboard was chosen based on what the Google video unit thinks are the most potent signals of viewer choice – the ad’s number of views, how much of it people chose to watch, and the percentage of non-ad views, with all of the ads here eliciting at least as many “organic” views as paid.

What’s most striking about the ads, which range from repurposed TV ads to spots created just for YouTube, is the popularity of the longer-form commercials. Many of the top ads are five minutes long or more.

The message: Create an ad that’s good enough, and the supposed short attention span of online viewers vanishes.

Here’s the complete list, with links for easy viewing:

1. Nike “My Time Is Now
13. Old Spice “Old Spice | Blown Mind
14. Old Spice “Old Spice | Bounce
19. Old Spice “Old Spice | Bed
20. Old Spice “Old Spice | Vending Machine

Apple’s iPad Mini Cannibalizes Other iPad Sales While Google’s Android Tablets Steal Share

Apple Introduces iPad Mini... and some new com...

From my Forbes.com blog The New Persuaders:

Apple’s grip on the tablet market it single-handedly popularized is slipping.

The maker of the iPad line of tablets still leads the market with a 55% share, according to a new report from market research firm ABI Research. But that’s down 14 percentage points in one quarter alone, and the lowest since the first iPad launched in 2010.

The problem, according to ABI, is that Apple was late to come out with a seven- to eight-inch tablet, well after the point at which it was becoming obvious that people really like that size. And when Apple did finally debut the iPad Mini, it was at a substantially high price relative to rivals such as Google’s Nexus 7 and Amazon.com’s Kindle Fire. “With the introduction of a smaller, lower-cost iPad mini, Apple has acknowledged Android’s beachhead of 7-inch-class tablets, though at the same time, it has failed to deliver a knock-out punch through innovation, pricing, and availability during the most critical selling period of the year,” ABI senior practice director Jeff Orr said in the firm’s release.

Worse, ABI says, the iPad Mini didn’t take back share from tablets powered by Google’s Android mobile operating software. Instead, people simply ended up opting for lower-cost tablets. Android’s market share rose to 44%. Another recent report from Finvista Advisors predicts that Android tablet sales will overtake the iPad’s by mid-2013. Android also recently bested Apple in smartphone shipments, at least before the iPhone 5 launched.

It’s not clear from the ABI report which companies benefited the most from the market-share shift. But it wasn’t just Google. According to one report, Google is expected to sell about 4 million Nexus 7s by the end of this year, but that’s somewhat fewer than some analysts expected.

Amazon says Kindle sales are strong, but it’s not providing specific figures to prove it. A report from Pacific Crest Securities says it’s likely to pick up a bit of market share in the fourth quarter, but not much.

The big losers are clearly every other tablet, including those running Windows–though that, too, could change if Microsoft’s new Surface tablet takes off.

Now, Apple’s share decline may well reverse in the current quarter, the first full one for the iPad Mini and other new iPad models, squarely in the heart of the holiday shopping season. And of course, it’s far better for Apple to cannibalize its own products than let others do it.

Problem is, it’s too late, at least for the moment. Now, rivals are eating some of Apple’s lunch, too.

Will Google Dodge An FTC Antitrust Bullet?

Image representing Google as depicted in Crunc...

From my Forbes.com blog The New Persuaders:

The Federal Trade Commission‘s antitrust investigation of Google is about to come to a head, by most accounts. But it’s a complex case touching on several aspects of antitrust law and whether Google’s search and other activities violate any of them, and the implications for Google, its investors, and Internet users could be huge.

Two attorneys intimately aware of the case provided contrasting views at a webinar this morning conducted by the investment firm International Strategy & Investment and its senior managing director Bill WhymanGary Reback is an antitrust lawyer most famous for representing Netscape in its antitrust case against Microsoft in the 1990s. He now represents several vertical-search companies, such as NexTag, that have complained about Google practices. Geoffrey Manne is a lecturer in law at Lewis & Clark Law School and executive director of the International Center for Law & Economics,which receives financial support from Google and other companies. He has written extensively about his belief that there is no strong antitrust case against Google.

The main takeaway: Despite a Bloomberg story last week that said the FTC was wavering and unlikely to attack Google’s core search business–and another today that repeats that assertion–there’s no agreement by the two sides on what the FTC will end up doing. Reback seemed to acknowledge that Google might find a way to maneuver politically around the FTC to avoid a full-scale assault on the way it conducts its search business. But he also noted that the European Union is closely watching the outcome and may act on its own if the FTC does nothing more than a settlement on the more minor issues.

One key point on timing: Press reports say there’s a Dec. 3 meeting between FTC Chairman Jon Leibowitz & EU Competition Commissioner Joaquin Almunia. What’s more, Leibowitz is expected to leave for private practice around the end of the year, so that could affect the case one way or another. And if it means anything, Bloomberg says Google CEO Larry Page met with the FTC today. …

Read the complete post at The New Persuaders.

Will The iPad Mini Kill Off All Of Apple’s Other Tablets?

From my Forbes.com blog The New Persuaders:

When Apple’s iPad mini debuted on Oct. 23, reviews were generally positive but a bit muted: What, no Retina display? And why is it so expensive?

But now, after a week or two of playing with it, some of the most prominent reviewers of Apple gear are never going back. Never going back, that is, to their bigger iPads.

From SplatF’s Dan Frommer:

My take after spending a bunch of the weekend with the iPad mini: This is the real iPad… The best thing about the iPad mini is its weight — it’s almost effortless to use, and that’s a big difference. … I feel more confident holding the iPad mini, which means I’m more likely to use it in more places — the whole point of an iPad.

From The Verge’s Joshua Topolsky:

There’s no tablet in this size range that’s as beautifully constructed, works as flawlessly, or has such an incredible software selection. … The iPad mini hasn’t wrapped up the “cheapest tablet” market by any stretch of the imagination. But the “best small tablet” market? Consider it captured.

From Daring Fireball’s John Gruber:

If the Mini had a retina display, I’d switch from the iPad 3 in a heartbeat. As it stands, I’m going to switch anyway. Going non-retina is a particularly bitter pill for me, but I like the iPad Mini’s size and weight so much that I’m going to swallow it.

From The Wirecutter’s Seamus Bellamy and Brian Lam:

The iPad mini is the best tablet to get and lets be honest, it’s way better than the full sized iPad for nearly everyone. I’d even go so far as to say that the full sized iPad is plain obscene after using the mini. … This isn’t just jive talk. I put my iPad on ebay (pls. bid but not too high because you should really buy a mini) and ordered a fully loaded iPad mini for myself.

I understand their attitudes completely. I don’t own an iPad (yet), but I have checked out both pretty extensively. I also have been trying out both Samsung’s full-size Galaxy tablet and Google’s Nexus 7 seven-inch tablet for several months. They’re not as slick as the iPads, but they suffice to provide a sense of the difference between the two models.

And the difference in user experience is huge, even more than you’d think from the difference in weight and size. Once I started using the Nexus 7, I virtually stopped using the Galaxy, largely because the Nexus 7 is so much easier to use. It’s easier to hold in one hand and way easier to transport without fear of dropping it. It slips into a laptop bag or even a jacket pocket easily enough that you don’t have to think twice about taking it outside the house. The iPad mini will enjoy all those advantages as well.

Taken together, the experts’ and my experiences with the smaller tablets makes me wonder if the full-sized iPads will soon be extinct. OK, not extinct but perhaps an endangered species. Already, it appears, they’re headed for eBay.

Honestly, I don’t believe people will completely stop buying the larger iPads. One look at that gorgeous Retina display, and it’s all over for no small number of people. Plus, watching videos on anything but your chest in bed is a bit cramped on a smaller tablet. And full-sized iPads, already increasingly replacements for laptop personal computers, likely will continue to benefit from that switch.

But it’s considerably less cramped on the iPad mini thanks to its larger display area compared with seven-inch rivals. And when Apple comes out with an iPad mini with a Retina display? Could be lights out for the bigger iPads.

Apple seems smart enough to figure out how to make plenty of money on, well, whatever it produces, so I’m sure it will make a lot of money on iPad minis. And even if the iPad mini cannibalizes the full-size iPads to some extent, it’s better for Apple to do the cannibalizing rather than watch rivals simply take the business away.

But a lower price is a lower price. So it will be interesting to see if that lower price on iPad minis will prompt enough more people to go for an Apple tablet to make up for any lost sales of much more expensive big iPads. Given bearish investors lately, not to mention people wondering if the company has peaked, Apple had better hope so.

Google’s Android Crushes Apple’s iOS In Smartphone Shipments–But Does It Matter?

Source: IDC

From my Forbes.com blog The New Persuaders:

Just four years after its debut, Google’s Android mobile operating software now claims 75% of mobile units shipped, according to a new report from market researcher IDC.

In the third quarter, according to IDC, some 136 million Android handsets shipped, almost double the 71 million shipped in last year’s third quarter. Devices using Apple’s iOS grew by a far lower 57%, to 26.9 million handsets, for a surprisingly low 15% market share. Don’t even ask about Blackberry or Windows Mobile. It’s a two-horse race for now.

Some folks wonder if this trend is heading toward a rerun of the Windows PC vs. the Mac. Maybe, and it’s got to be something that worries Apple CEO Tim Cook, who hardly wants to be the guy who let the mobile revolution get away.

But in the short to medium-term, it’s doubtful this is a killer for Apple. Why?

For one, Apple’s share was probably especially low in the last quarter because the eagerly awaited iPhone 5 didn’t ship until September, very late in the quarter. Add in new iPad models just introduced, in a holiday quarter when Apple devices are probably still the gift people would prefer to give over Android gadgets, and it’s hard to imagine that Apple won’t see some rebound in the fourth quarter. …

Read the complete post at The New Persuaders.

What Storm? Google Keeps Apple War Hot With New Tablets And A Phone

From my Forbes.com blog The New Persuaders:

After Hurricane Sandy forced Google to cancel an event planned in New York today to show off new Android devices, it’s launching them anyway–keeping the search giant in pitched competition with Apple.

Google introduced two new sets of tablets, in addition to a new version of its intelligent personal assistant Google Now:

* A Nexus 7 seven-inch tablet with 16 GB of memory, double the previous low-end memory, for $199, the same price, and a 32 GB model for $249.  A new version of the Nexus 7 with a cellular connection and 32 GB for $299.

* The Nexus 4 smartphone, developed with Korea’s LG. As expected, it has a 4.2-inch display, as well as wireless charging so you don’t have to plug it into a power adapter. It’s $299, on sale starting Nov. 13.

* The Nexus 10 tablet, developed with Samsung, that adds a new full-size tablet to Google’s lineup. Available Nov. 14, it costs $399 for a 16 GB model and $499 for a 32 GB model.

The smaller tablets are intended to counter last week’s announcement by Apple of the iPad mini, its don’t-call-it-a-seven-inch tablet. Apple itself has clearly felt the new heat of competition, so while the iPad mini will likely sell well during the holiday season, Google’s new devices–along with Amazon.com’s Kindle Fire tablets, which Amazon says are selling well, and perhaps even Microsoft’s Surface tablet–help make it a real contest.

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