The Great Web Whales

Ecosystem is a term often used to describe Internet business models. Given all the Web sites being acquired recently — including, Bloglines, AskJeeves and Flickr — I wonder if we’re developing an Internet ecosystem populated by whales and krill.

The recent deals all seem poised to harvest advertising visits through the large Web sites that control most of the traffic on the Web. They would be the whales.

Whether you produce some content or merely consume it, you are probably krill. Some Internet whales, or wannabe surface feeders, are cycling some cash back to the more ambitious krill through programs like Google’s Adsense and competitors such as the Revenue Science behavioral system for linking ads to content.

Omar Tawakol, vice president for marketing at Revenue Science, recently noted that on the Web “you get one or two sites with a ton of traffic (like MSN or Yahoo!), and then 10 or 20 sites each with one tenth the traffic of those two, and 100 or 200 sites each with 100th of the traffic, etc.” This is not so bad, he wrote, because “if you add up all the traffic at the end of (the Web), you get a lot of traffic — and more importantly, a lot of very rich, specific user behavior.”

Revenue Science will need a very efficient seine to catch and process enough krill to allow it to swim with the whales. Say the company wanted to capture 44 million unique visitors per month from krill-sized publishers. Say we definedthese “small” publishers as those who generate 10,000 unique visitors per month. It would take 4,400 of these krill sites to generate the traffic equivalent of an AskJeeves. Serving 4,400 Web publishers would probably require much handholding, even assuming a high degree of automated account processing.

As for the krill side of the deal, that depends on the average value per unique visitor. Using a ballpark starting point of 20 cents yields a gross of $2,000 per month on 10,000 visits. Not bad but don’t quit the day job.

P.S. Let me close with two bits from the Center for Media Research.

1.) Final figures from TNS Media Intelligence put total 2004 advertising spending at $141.1 billion up 9.8 percent from 2003 (roughly twice as fast as GDP growth). Internet advertising rose 21.4 percent to $7.44 billion, to 5 percent of the total, and was the fastest growing category.

2.) A CNN/USA Today/Gallup Poll said three out of four Americans use the Internet, but only one in four are familiar with blogs, and 56 percent knew nothing of them. The highest concentration of blog readers (47 percent of the sample) were persons in the 30-49 age group, which makes up 41 percent of the adult population.

Tom Abate
Cause if you ain’t Mass Media, you’re Mini Media