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Tuesday, December 14th, 2004

Personalized Convergence – Assumptions on the Future

 

Innovation in the world of search seems to come in waves with the major search engine firms appearing to follow each other’s lead in the development of new products, tools and services. Witness today’s introduction of a desktop search/toolbar by MSN. Search engines are standardizing their services around the basic business model of contextual ad delivery and introducing new products and features designed to win the loyalty of new users and retain the loyalty of old ones. The past year has been one of the most expansive and interesting in the world of search since day one. Two major trends, personalization and localization, combined with the competitive necessity to gain users and advertisers provided the foundation for development of desktop search applications and the immense number of toolbars available now. The goal of all major search firms is to offer results that are relevant to an individual searchers’ profile in the least steps possible. User adoption of toolbars and desktop search are major steps in accomplishing that goal.

Advertising in the form of increasingly personalized, contextual delivery is going to pay the bills, at least for the foreseeable future. The Internet is about to under go its most massive growth spurt yet and a large part of that growth will be driven by the unique search patterns of every individual user of a search engine toolbar or desktop search appliance. Without radically overstepping the boundaries of the spirit of personal privacy laws, (which differ from nation to nation), search engines have been gathering veritable gold mines of information on every registered individual’s searching habits. In other words, your machine has a number and that number is you, or at least it is representative of the most frequent users’ search habits.

This expansion, at least as it relates to the world of search is based on two fundamental premises.

The first and most important premise is that an individual’s surfing habits can determine user-specific information to be served to them. Those folks who plant ad-ware and spyware through free software downloads aren’t the only ones interested in knowing where you’ve been going. Google, Yahoo, MSN, ASK, and every other search engine that releases a toolbar, are also pretty keen on knowing what you are interested in. It helps them send the right paid advertising to your search-browser, thus increasing the likelihood of successful conversions for their clients. There is a lot of business interest in delivery of advertising information directly to individuals and thus, localization and personalization go hand in hand with each other. It is almost totally unlikely that the major search engines share your personal information with other commercial interests, especially considering the competitive advantage having such information gives them.

The second premise is that the Internet as we know it today will expand into an electronic meta-verse which can be catalogued by the search engines. Distribution of print media is a slowly dying business and all other forms of information or entertainment can be recorded or broadcast electronically. In the near future, information and entertainment choices will be presented to consumers primarily through listings based on search results. In many ways, this world already exists. Barring any sudden disasters, consolidation and convergence will start to wrap it up in easy to perceive packages within the next two years.

This emerging electronic meta-verse will include television programming, music delivery, radio-format broadcasting, first-run movies and live events. It will also include tens of millions of independent creations as technology advances to allow anyone with (or without) talent to produce and web-cast their own media. For an early experiment in merging mediums through a search driven media (without ad-content), check out www.zed.cbc.ca/. While this example has obvious commercial limitations, it illustrates the general concept of electronic meta-media.

It’s only a matter of time before search engines themselves present increasingly specific directories of cultural fare, some of which they will be producing themselves. In short time, those directories will become spidered databases and those databases will become second cousins to the search tools of today. The search driven nature of the emerging meta-media universe offers a virtually limitless amount of advertising space and will make the search firms (and those who do business with, for, or on them) into the dominant players in the advertising industry. It will also change the nature of the relationship search engines currently have with those displaying paid-advertising such as AdWords and Overture ads. If you thought 2004 was an interesting year in the business of search, wait to see what’s coming in the next few years. By the time Beijing hosts the 2008 Olympics, the major TV networks will have adapted.


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