AirBNB’s Drastic Crisis Response
Hot on the heels of VC Charlie O’Donnell’s rousing defense of AirBNB, the company announced a new, dramatic policy: $50,000 in de facto insurance for all hosts. This opens AirBNB up to significant fraud risk; they may impose some pretty strict hurdles, or end up paying the $50,000 mostly to people who seem likely to raise a stink (like the articulate but logorrheic “EJ” whose disastrous AirBNB experience (her apartment was ransacked by meth addicts) started the whole thing.
This illustrates one of the hidden benefits of AirBNB’s massive fundraising round from a few months ago. They should be finding an insurance company that is somehow willing to insure semi-legal or outright-illegal temporary sublets among strangers (who, if they know each other, may also collaborate on fraud). It might take AirBNB months to negotiate such an insurance deal, and even if they did, they’d be negotiating from a serious disadvantage. But AirBNB has just raised $112 million. Divide that by $50,000, and they can stand an “EJ” a day for the next six years without going under. Which means that when they do negotiate a deal with an insurance company (since specialty homeowner’s insurance is not the core competency of a company founded by three designers whose sole asset was an airbed), they’ll be able to get a reasonable deal.
One AirBNB competitor got their name into a headline by declaring that they wouldn’t “trade security for volume,” and noting that they require ID verification. About that: meth users are responsible for a huge amount of ID theft (“EJ” is an example of this—they used her credit cards). Video chat and social connections may be more secure than government-issued ID, in this particular case.
Google+ Slows Down
Google+ referrals may be down 40-50% month over month. It’s more likely that last month was the aberration and this month is the trend—this month is one of those times that illustrates the difference between “registered” and “active” users, and highlights the fact that a surge in registered users over one time period means a disproportionate increase in inactive users in the next.
Meanwhile, Compete.com compares the Google+ launch to Spotify and Pottermore.
Datacenters Less Power-Hungry than Thought (And Yet…)
A recent study argues that the massive growth in datacenters has been accompanied by a slightly less massive growth in power usage. In the US, they appear to use around 2% of all power. However, this discounts the potential net energy savings from online activity: as long as people are substituting an evening at home with Netflix for an evening out at the movies, or telecommuting rather than showing up at the office, datacenters will help reduce power consumption, even if their measurable effect on power use is positive.
StockTwits Tries a Facebook-style Facelift
Investment chatter aggregator StockTwits has launched a new ‘activity stream’ feature, which allows users to track the behavior of other users they follow. It’s quite similar to the Facebook news feed, and offers similar utility—it’s a stream of actions, not just explicit status updates.
(Full disclosure: members of the Digital Due Diligence and StockTwits teams are friendly, and StockTwits—and affiliated blogs—have linked to and promoted Digital DD content.)
Google Hotel Monetization Gets More Aggressive
Google previously announced that it was making a push into hotel bookings. The results are already visible: paid ads and Google-owned properties completely dominate the results for numerous lodging-related queries. Travel (and, by extension, hotels) are one of the few categories of online business that support multiple competing public companies—Priceline, Expedia, Travelzoo, and a few overseas names—so it’s possible to measure how big a market Google is going after, here.
AutoDesk Buys Into the Bottom of the Market
High-end CAD software provider AutoDesk has bought community-run how-to site Instructables. The business seem to be related only philosophically: both companies help people create physical things, but Instructables targets the market for people with time but minimal money; AutoDesk targets a mostly corporate market willing to trade vast amounts of money to use their time more efficiently. It’s possible that AutoDesk has built relationships with companies whose products could be sold to the Instructables community, but the business case for this deal is hard to parse.
A Real-Money Auction House for Activision’s Latest
Activision Blizzard’s latest likely-to-be-a-hit game, Diablo 3, features a real-money auction house, allowing players to sell in-game items for money (subject to an exchange rate) or game time (subject, presumably, to a more generous exchange rate). They’re creating currency zones to take into account differences in game cost and cost of living (perhaps to prevent the prison labor arbitrage). This has some interest potential: it’s a very clever form of price discrimination, since the game creators can tweak the financial rewards for interesting and boring work in order to provide an engrossing experience for cheapskates and for Zynga-style “Whales” willing to pay up to skip the grind.
The risks in this business model are being amply explored by the science fiction community—one existing novel and one upcoming one focus on the real-world ramifications of massive online game economies.
Twitter’s Poor Developer Relations Cost it Another Service
Topify has closed down, citing unpredictable changes in the way Twitter handles email notifications. Topify was one of several services that offered Twitter users slightly more useful email notifications through the Twitter API. Given how much of Twitter’s growth is based on a) power users, and b) the apps that support their power usage, it’s a bad sign that Twitter isn’t paying closer attention to their needs.
Foursquare Followable Pages Present New Marketing Opportunities
Foursquare now allows one-way following for special accounts. This opens up an entirely new category of Foursquare usage: virtual tourguides. A bookstore, for example, could tag locations around the city with literary trivia, and provide directions to their nearest outlet; Starbucks could provide lifestyle-related tips in the same vein.
Marketers have been using this general concept on Foursquare for a while, but they generally had to use some sort of hack—like creating a fake account named for a business, and then randomly adding dozens or hundreds of Foursquare users as friends. Foursquare’s corporate partners have been able to create similar accounts for some time, but this opens up the medium to more experimental campaigns.
Google May Be Testing Ads at the End of Results
Search Engine Land has a screenshot. This isn’t unprecedented; mobile searches already show ads at the end of the page, for example. It is one more opportunity for Google to devote more real estate to paid clicks. Additionally, an advertiser could target end-of-the-page ads with copy that focused on alternatives, rather than competing versions of the same product. If Nike runs an ad on the term “running shoes,” they can show up near the top; if Vibrams is running those ads, they might want to show up after all the standard choices have been exhausted.
A Taxonomy of Link Spam
SEOMoz has a thorough post on ways search engines may identify link spam. Essentially, they’re looking for various kinds of homogeneity, which can end up flagging legitimate campaigns as spammy if they happen to be very successful in a single metric. The whole post is worth reading.
Trulia Seeks an IPO-Ready CFO
Established startups continue to rush towards the IPO window: Trulia’s COO announced their CFO search.
YouTube (Desperately?) Offers Users Advice on Marketing Their Content
A cynical view is that YouTube wants to encourage the kinds of filmmakers willing to read a 70-page guide to promoting their videos to promote their videos. The site’s enormous popularity has long made it home to enormous amounts of poor-quality content, and YouTube’s long-term strategy has clearly been to get better quality videos (so they can place better, higher-CPM ads on them). It’s a positive sign, and certainly more scalable than their manual pick-and-choose-and-promote strategies in the past.
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