At the end of November, I flew out to give a speech to 350 Google folks. They had invited me to join a panel on the best way to for Google to work with partners.
My riff (I only had about 8 minutes… gotta hate panels) was to point out that AOL, Microsoft, Yahoo and others before them had had the same challenges in building an environment that attracted partners and media companies. (I had run companies that worked with each of them). The question it turns out, is always the same: do you have a platform that I can build a business on?
Obviously, a lot goes into that calculation. It’s not just tools and technology. It’s attitude and predictability. It also involves a threshold, an attainable goal that separates insiders from outsiders.
Take Hollywood, for example. There are literally tens of thousands of people and organizations that have built a business around the movie-making platform. The major studios provide a predictable, profitable place to make a living. Screenwriters, technology companies, advertising agencies–they know that they can depend on the system, and even better, they realize that once they’ve paid some dues, they can profit over time by getting better gigs, more reliable income streams, etc.
Wal-Mart has done the same thing with the businesses and vendors that count on them. They have created a series of rules and procedures and over time, it gets easier and easier to make a living working with them.
Small organizations can do the same thing. Restaurants, for example, build a universe of staff and vendors, each of whom is making a small bet on the stability of the platform as well as the opportunity to exploit economies of scale as a trusted partner.
The challenge for Google, I pointed out (and was echoed by others on the panel) is that the ‘algorithm’ that drives the search engine doesn’t favor trusted partners. The New York Times should get the benefit of the doubt, for example, more than it does. It’s easy to argue for the democratic nature of search results, but both the business environment and human nature demand elements of promotion and trust.
Anyway, I got back from my trip to Google and crunched some numbers and posted this good news about Squidoo. We’ve hit profitability, grown to be three to five times as big as others in our space and reached more than 125,000 users. A good day.
The very next day, Google announced Knol, a direct lift from Squidoo circa 2005. Apparently, Google wants to be in our business. It’s almost enough to ruin your day.
Then, a funny thing happened: I started getting notes of congratulations. Of all the business models and all the internet ideas to jump on, Google had chosen ours. There were hundreds of neat ideas out there, but they picked ours.
That goes a long way to legitimize the original idea. It brings new users into the space. It makes it easier to find partners who want to exploit this ‘new’ idea. It allows room for creativity. It’s not about whether or not someone should be doing this. It’s about which place they want to do it in. That’s a huge change.
Just as the acquisition of blogger led to an explosion in blogging software, Google’s Knol makes the space pioneered by Squidoo a lot more attractive. Apparently, the best thing that can happen to you if you pick Google as a platform is that they mimic you. This isn’t true in the restaurant business (it’s bad news for the farmers when a restaurant starts its own farm). This isn’t true for Hollywood (it’s bad news when the movie studios start their own film processing labs.) The nature of the Web, though, seems to be that because of the very openness of the system, imitation is the highest form of endorsement.
[aside: I couldn’t resist responding to Udi Manber’s posting about why Google is launching Knol. He said, "We believe that many do not share that knowledge today simply because it is not easy enough to do that." Well, I took the sample page (under Creative Commons) that his wife had written and turned it into a Squidoo lens. I even added a few features that would double the income she might earn for the charity of her choice. It didn’t take very long.]