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Google makes 20 cents per search

According to the BusinessWeek article, "Why Yahoo's Panama Won't Be Enough", Google is making an average of 20 cents per search:

Using data on total search queries, released by comScore, Caris & Co. analyst Tim Boyd estimates that Yahoo made on average between 10 cents and 11 cents per search in 2006, bringing in a total of $1.61 billion for the first nine months of the year.

Google, meanwhile, makes between 19 cents and 21 cents per search. As a result, it made an estimated $4.99 billion during the same period.

Wow, is it just me or does that seem really high? According to my Google Search History, I'm averaging about 30 searches per day. That means Google is making about $6 a day from my surfing.

[via Geeking with Greg]

Cool site design

Happy holidays, everybody. Check out Wisdump's Top 7 Freshest Designs of 2006 for some very cool websites.

I Need This #3,224: Air Mattress

This air mattress by Janjaap Ruijssenaars uses a matching set of repelling magnets, built into the bed and the floor below, to support 2,000 lbs. It's a steal for $1.5 million.

[Via 37 Signals]

MySpace beats Yahoo in Lucrative Popularity Contest

As just reported, MySpace is now the most viewed web property on the internet. Wow. Yahoo better acquire somebody quick. Normally you'd expect (dread?) some sort of commentary around this, but tomorrow at 7am I'm interviewing best-selling author Geoffrey Moore for iinnovate, so I need to go to sleep. I'll ask him what he thinks about this news and post his reply tomorrow.

[via Techcrunch]

Entrepreneur Idol at Stanford GSB

Last week we had a great event at the GSB organized by Charles River Ventures and my friend John. It was called Entrepreneur Idol (see event video here). Sixty MBA students gave 30-60 second pitches of a business idea to a panel of judges, including George, Bill Tai and Susan Wu . It was a lot of fun and a great idea for an event. Check out the video above. And yes, I did give a pitch, but unfortunately didn't make it into the top three.

Ugly is the new Beautiful

My good buddy Jon sent me a great link continuing a recent theme of success through ugly design. The Surprising Truth About Ugly Websites has some nice insights. For example, an ugly design conveys a very powerful message:

The idea of an ugly website could present a positive message never crossed my mind. Yet the fact is, ugly websites do have the ability to present the perfect marketing message. What is that message?

You can trust us. We are a family run business and do not employ a marketing team. Our website is simple, but functional. Most importantly, our goal is to serve our customers, not necessarily learn HTML.

I don't think that ugly sites are necessarily "functional" (look at MySpace, it's neither pretty nor functional), but I do agree with the notion that ugly design has the potential to convey a powerful message of authenticity.

Creosote Conundrum

In my Infotech Industry Seminar today, intel co-founder Andy Grove introduced a new concept that he has coined "the Creosote Conundrum."

The creosote bush is a bush which dominates the landscape of North America's hot deserts. It is one of the best examples of a plant that tolerates dry conditions simply by its toughness. It is typically the largest plant in its environment as it competes aggressively with other plants for water.

The Creosote Conundrum says that a company's major successful product line will compete aggressively for resources with any other product lines which emerge. Therefore, the when there is a "creosote"-type product line in your organization, it will kill out any products that try to grow near it. The generalized message is that:

"The more successful you are, the more difficult it is to generate an alternate strategy."

We have seen this with companies such as Western Union, Xerox , AT&T and Microsoft.

There are many causes that lead to Creosote Conundrum. Notably there are limits to management attention. The opportunity cost of new research is, at the margin, very high, as successful companies typically have better opportunities within existing product lines and industries.

Recently we saw that at Microsoft, a singular focus on existing technologies caused it to initially "miss" the browser and then search opportunities. It is interesting to think whether Google's Adword will be their eventual creosote.

Ideas vs. Opportunities

Serial entrepreneur and angel investor Audrey McLean was part of an entrepreneurs panel today in our Formation of New Ventures class. She had a great sound-bite concerning aspiring-entrepreneurs coming to her with 'ideas'.

"I don't care about ideas, I care about opportunities. You need to know what problem you're solving and which people you're solving it for. And are there enough people who have the problem who will pay enough to make a sustainable business."

Warhol on Numbers

If you don't know something exists, how do you search for it?

Sorry to geek out on everyone here, but I'm sitting in a really cool talk with Greg Linden, who is guest lecturing at a data-mining class here at Stanford. Greg is the guy who initially created Amazon's recommendation engine and is talking about the general field of discovery and recommendation engines. Quick summary: search engines help you find what you already know you want. Discovery engines show you what you might want. Big examples of companies using discovery are Tivo, Netflix, Stumbleupon, Pandora and Amazon As some of you may know I'm big into recommendation and discovery engines now, and I'm working on a startup in the space.

Apparently, Amazon has tried to use different recommendation schemes: item-to-item, content-based, and clustering. Apparently item-to-item (people who bought this, bought that) works the best for Amazon. (Of course it's not literally item-to-item, Greg explained, as then you run into the "Harry Potter Problem" that everybody who bought x, probably bought Harry Potter.)

One interesting point Greg brought up was a quote from Peter Norvig:

"Don't worry about the algorithm, worry about the data.
- Peter Norvig

The graph below is an interesting representation of the power of data from a paper by Banko and Brill. Shows that the leaders in the recommendation space are most likely to be those who control the most vast amounts of data.

OK, I better post something non-geeky quick, lest I lose all of my readers.