Alipay Settlement Doesn’t Impress Yahoo Shareholders
Yahoo’s Alipay settlement, announced early Friday morning, initially pushed the stock up. By the end of the day, Yahoo was down slightly. This was due, in part, to negative comments from analysts, who are still concerned that Yahoo essentially gave away part of an extremely valuable business.
Epocrates: New Frontiers in Ad Distribution
There is a small, narrowly-defined demographic on which advertisers spend $23,300+ per person, per year. And there’s a company that has managed to get their ads in front of (and in the hands of) a growing share of this market. That, at least, is the upshot of the New York Times’ bullishly tut-tutting article on healthcare app maker Epocrates. Epocrates, which is down 25% from its IPO-day close earlier this year, doesn’t have quite the revenue growth to back up this enticing story. But it’s a story worth following. Epocrates may end up being valued like a new-age trade magazine: predictable circulation, and predictably ever-advancing ad rates. But there’s a big gap between what they have now and what they’d need to justify that. (And at 400 times earnings, how long will the market want to wait and see?)
In related trade-magazine news, the “Business-to-Influencer” strategy of Prometheus Media has led to a management shakeup at the firm.
Another Eye-Tracking Case Study
Gazehawk continues to crank out great eye-tracking information. Their most recent post reveals how experienced and inexperienced reddit users view the site. As they point out, it’s hard to tell whether a site shapes its users, or users with particular information consumption patterns glom on to the site that best fits them. Either way, the main conclusion one can draw from this study is that content that content designed to succeed on reddit should appeal to users with a very short attention span. Reddit may be the single social media site with the strongest emphasis on rapid turnaround from viewing to sharing, so this reinforces an existing viewpoint.
Another Smart LivingSocial Deal
LivingSocial continues to impress as one of the savviest of the classic daily-deal providers (classic in the sense that it’s not either a) a newspaper monetizing its local audience, or b) a business model stumbled upon by an unrelated startup). They’ve recently announced a deal with Delta allowing them to distribute daily deals to flyers based on their destination, rather than their home city. It will be interesting to see how merchants respond to this: customers who fly out the next morning aren’t especially loyal, so these deals may be designed more to fill empty seats during slow times than to bring in new long-term customers. That means a lower discount and a lower cut for LivingSocial. But it also means that LivingSocial’s email open rate won’t take a hit when their users are out of town—which could give them more leverage on national deals, and a lower overall churn rate.
Meanwhile, Foursquare is offering Groupon integration. This is far less interesting than their American Express deal, but does showcase Groupon’s belief in location-based partnerships as a key to growth. (A few months back, Loopt effectively scooped Groupon’s own PR department by launching push notifications for deals.)
Do Browsers Determine Search Engine Usage?
A recent study shows that Bing users tend to come from Internet Explorer. Google is well aware of this dynamic, hence Chrome (and, to some extent, Android). Bing seems more willing to pay up for distribution, while Google has made a few choices (Firefox and Chrome) that account for a big fraction of its distribution. Bing may look at search engines—particularly mobile ones—as a good opportunity here.
Last week, Digital Due Diligence highlighted a study of corporate alumni who founded startups. This week, there’s a new data point: a list of ex-Oracle employees who started startups. The Paypal Mafia still hasn’t been subjected to the same sort of analysis, perhaps because the numbers and interrelations are so complex.
A Casualty of the Digital Age: New Yorker Covers
Mediaite laments the fact that the app version of The New Yorker doesn’t emphasize covers the way the physical magazine does. This may be true, but a note to avid New Yorker readers: old New Yorker covers make an excellent iPad screensaver. If Conde Nast catches on, those covers could see a resurgence.
Digital Due Diligence Weekly