Netflix splits, caution on Facebook, and the decline of TechCrunch…

Netflix Splits DVDs and Streaming

Netflix has split its DVD business from its streaming business, perhaps in anticipation of spinning off one or the other. In the announcement, Netflix’s CEO specifically calls out AOL, which is facing exactly what he wants to avoid: half of the business belongs in some kind of asset-stripping private equity portfolio; the other half looks more like something that should be raising venture capital than something that should be publicly traded.

Risking the DVD business in order to win at streaming is risky, but it’s also smart, if for no other reason than that other CEO’s won’t risk the backlash that Netflix has gotten.

The Math of the Daily Deal

Rushrez plays around with the assumptions behind daily deals in order to show what their profitability depends on. One of their conclusions: opportunity cost is a major hidden factor. And that’s just going to get worse: just wait for the first aggregator that mashes up Foursquare or Yelp data with Yipit’s daily deal APIs in order to show people only daily deals at places they already like.

Has Facebook Already Flipped the Switch?

The bull case for Facebook used to be that they hadn’t even bothered to turn on monetization. Once they did that, you’d see revenue screaming towards infinity. It’s getting harder to make that case: the majority of Facebook pageviews show an ad. This doesn’t destroy the bull case for Facebook, but it amends it. Barring some kind of major new product launch, Facebook’s growth is going to be a lot more linear.

In other Facebook news:

• They launched asymmetric following, which seems pretty pointless. The only people for whom it’s useful are celebrities, but they already have asymmetric following through Pages. (Side note: in the future, “Celebrity” will probably be a word for someone with whom it’s not weird to have an asymmetric friend / follower relationship.)
• Facebook is using Foursquare data for locations.
• Facebook will likely announce tighter Hulu integration next week, rendering Hulu marginally more valuable and less digestible to buyers.
• They’re also going to allow Twitter updates from Facebook. That was probably inevitable. It’s also going to turn Facebook into one of the largest Twitter clients, overnight.

Google Fights Harder in Russia

Google has disabled the initial search engine selection menu in the Russian version of Chrome. (Yandex is one of the few search engines to earn a higher market share than Google.) This wouldn’t fly in the US, but Yandex did it first.

Other Google updates:

• Google+ pages about stories are outranking the stories themselves. This is a case where Google should take manual action to demote their own properties—they don’t net benefit from the extra pageviews. It will be interesting to see if that’s what they do.
• Google has launched Flight Search, which is pretty slick. As always in the travel vertical, this won’t make vast amounts of money; the real money is always in hotels. Google already generates lots of AdWords revenue from hotel listings, so they may be cautious about expanding too fast. (Especially since they’ll need to have more comprehensive search and better pricing than all their existing advertisers put together—otherwise, it won’t work from a user experience standpoint.)

Groupon Versus Reviews

A new study shows that using Groupon tends to hurt Yelp ratings, but that the decline typically starts ahead of the Groupon. There are a few possibilities: the most obvious is that Groupon users are generally negative, or that Groupon foot traffic hurts the restaurant experience. Or Groupons could be the first resort of businesses that have decided to cut back in other places. Or most businesses could gradually revert to a 3.5-star review (that’s where most online reviews trend over time), while Groupon might prefer working with better-reviewed establishments.

Other daily deal news:

• FriendFinder has bought a Chinese daily deal site, for some reason.
• Groupon is still growing, per Yipit.
• JetSetter is getting into vacation home rentals. It would be a suitable irony if the most profitable daily deal companies ended up being the ones that used daily deals as a way to build up a big email list for a more traditional e-commerce model.

The Excessively Casual World of Corporate Social Media

Katy Lindemann has a fantastic post about ostentatiously friendly corporate social media accounts. She’s correct in noting that, especially in serious fields like consumer finance, this is just not helpful. (It’s also a monoculture, at least in social media: anyone who doesn’t act like conventional Twitter users on Twitter won’t get critical mass.)

Full Disclosure, Via Twitter

IRWeb has a fascinating piece on WebMediaBrands’ CEO pre-announcing earnings via Twitter. Investor Relations tends to be a pretty cautious field, because the downside risk usually involves painful lawsuits. This could be an interesting precedent, though—and if it works, it’s good news for Stocktwits IR.

Bing’s Culture

An ex-Bing employee writes that Bing’s culture is broken. This is very anecdote-driven, but it’s plausible: Bing is a vastly expensive project whose success metrics are unclear. (Bing is probably a good deal if it breaks even and keeps Google unstable. But is it a good deal if it keeps bleeding money? Is it a good deal if Yandex or Blekko grab enough market share to weaken Google on their own?)

As basically every government agency demonstrates, massive budgets and vague goals are a recipe for over-ambitious politicking.

The Decline of TechCrunch

Danny Sullivan has an excellent post on what will happen to TechCrunch. Sullivan was in a similar situation a few years ago, and his new site is quite successful, so he’s worth paying attention to. (He also provides a case study that’s far less optimistic for Arrington’s next venture.)

Meanwhile, Poynter points out the NYT’s own record on conflicts is pretty flimsy. The NYT is a bigger organization than TechCrunch, of course; it’s not as if their journalists are personally managing investments and writing about the same companies. And BetaBeat points out that SEC regulations on touting investments could be enforced in cases like this, even though the companies are private.