Excuse the pun, of sorts. Many of the speakers and panelists over the past couple of days at Where 2.0 demonstrated a range of cool technologies or whiz-bang features that probably don’t have a hope of becoming breakout, mass market consumer applications. That doesn’t mean they aren’t interesting or useful. But the question is: where will these companies be in 5 years?
Presentations from Yahoo’s Paul Levine and MapQuest’s Jim Greiner today independently focused on practical issues like business models and mass consumer adoption.
Paul Levine, Local GM for Yahoo, had the unfortunate challenge of being in front of a hungry crowd before lunch and dealing with some technical glitches with his presentation. However he did an excellent job, given those challenges, presenting tons of information in a compressed 15 minutes. Levine raced through Yahoo’s broader social media strategy, Local and Maps. He also announced the Yahoo Local & Maps Blog, which Yahoo sees as a communication tool for all its local constituencies (bloggers, press, merchants, consumer-influencers and developers).
Levine said, “Participation is guiding our strategy, for Yahoo broadly, for search and especially in Local.” He reiterated the FUSE (find, use, share and extend) concept. “We want to tap into the amazing body of content that’s out there broadly, whether it’s online or in people’s heads.”
Levine identified three principal constituencies for Local and Maps: consumers, merchants and developers. Levine said that Yahoo’s strategy is to build “a container” for consumers to provide content to Yahoo. He cited Answers and Local ratings and reviews as two of several examples. Merchants are the business model and developers help extend the value of Yahoo’s platform and tools. Regarding monetization Levine asked the semi-rhetorical question: “Where’s the business around all this; where’s the value creation?”
That’s a theme that MapQuest GM Jim Greiner echoed in his talk later in the afternoon. Greiner said that he wanted to impress upon the crowd “three simple truths” that MapQuest has learned in its more than 10 years in business: 1) focus on what’s truly useful to consumers, 2) make it economically viable and 3) aim for the mass market.
He gave examples of each but pointed out that the dominant use case of mapping online is still driving directions. By his own admission, MapQuest is not the innovator it once was, but it is the market leader. He showed comScore traffic data reflecting MapQuest’s leadership and continued growth, despite some of the “sexier” features being promoted by its competitors. But he acknowledged that some of those features would be added to MapQuest: personalization, aerial and satellite imagery and street-level photography.
Greiner stressed simplicity and utility and cited Wayfaring.com as a mashup tool that ordinary people could use without any technical knowledge. Ironically, however, the founders of Wayfaring.com haven’t quit their day jobs because, according to hearsay, they don’t yet have a business model that permits them to do that.
Indeed, there are only two or three business models online: subscription/licensing or some version of advertising. And with advertising you ideally have to offer targeting and some degree of reach. This is very difficult for most of the small consumer-facing sites at Where.
Effectively then these startups become labs and talent incubators for the search engines and portals. While most of these companies hold out hope of being the next Flickr or del.icio.us, both of which Yahoo acquired.
In contrast to Greiner’s very pragmatic, “real-world” approach, Yahoo’s Levine struck a balance between practical questions (i.e., monetization) and technological innovation. On the latter point he discussed the integration of Yahoo assets such as Flickr, Local and mapping and the work being done at the Yahoo Research Lab in Berkeley. As an example he discussed automatic geocoding of photographs from mobile phones using cell-tower triangulation.
Levine ended by seeking to differentiate Yahoo’s Maps and API from its competitors. He went through a list of bullets but mentioned the Yahoo content API as part of the overall value proposition for developers: Flickr, Local content and traffic in addition to the underlying mapping platform.
Levine also pointed to branded online campaigns created by Baskin Robbins and Columbia Pictures utilizing Yahoo’s mapping tools as evidence of its richness and adaptability.