 Internet companies |
| Mar 19th 2009 The end of the free lunch,(again.....). From The Economist print edition The demise of a popular but unsustainable business model now seems inevitable |
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| Illustration by S. Kambayashi. |
| "IN RECENT years, consumers have become used to feasting on online freebies of all sorts: news, share quotes, music, e-mail and even speedy internet access. These days, however, dotcoms are not making news with yet more free offerings, but with lay-offs—and with announcements that they are to start charging for their services." These words appeared in The Economist in April 2001, but they're just as applicable today. During the dotcom boom, the idea got about that there could be such a thing as a free lunch, or at least free internet services. Firms sprang up to offer content and services online, in the hope that they would eventually be able to "monetise" the resulting millions of "eyeballs" by selling advertising. Things did not work out that way, though, and the result was the dotcom crash. Companies tried other business models, such as charging customers for access, but very few succeeded in getting people to pay up. Then it happened all over again, starting in 2004 with the listing of Google on the stockmarket, which inflated a new "Web 2.0" bubble. Google's ability to place small, targeted text advertisements next to internet-search results, and on other websites, meant that many of the business models thought to have been killed by the dotcom bust now rose from the grave. It seemed there was indeed money to be made from internet advertising, provided you could target it accurately—a problem that could be conveniently outsourced to Google. The only reason it had not worked the first time around, it was generally agreed, was a shortage of broadband connections. The pursuit of eyeballs began again, and a series of new internet stars emerged: MySpace, YouTube, Facebook and now Twitter. Each provided a free service in order to attract a large audience that would then—at some unspecified point in the future—attract large amounts of advertising revenue. It had worked for Google, after all. The free lunch was back. Now reality is reasserting itself once more, with familiar results. The number of companies that can be sustained by revenues from internet advertising turns out to be much smaller than many people thought, and Silicon Valley seems to be entering another "nuclear winter" (see article). Internet companies are again laying people off, scaling back, shutting down, trying to sell themselves to deep-pocketed industry giants, or talking of charging for their content or services. Some Web 2.0 darlings (MySpace, YouTube) managed to find buyers before the bubble burst, thus passing the problem of finding a profitable business model to someone else (News Corporation and Google, respectively). But quite how Facebook or Twitter will be able to make enough money to keep the lights on for their millions of users remains unclear. Facebook has had several stabs at a solution, most recently with a scheme called Facebook Connect. Twitter's founders had planned to forget about revenues until 2010, but the site now seems to be preparing for the inclusion of advertising. The bill, sir The idea that you can give things away online, and hope that advertising revenue will somehow materialise later on, undoubtedly appeals to users, who enjoy free services as a result. There is business logic to it, too. The nature of the internet means that the barrier to entry for new companies is very low—indeed, thanks to technological improvements, it is even lower in the Web 2.0 era than it was in the dotcom era. The internet also allows companies to exploit network effects to attract and retain users very quickly and cheaply. So it is not surprising that rival search engines, social networks or video-sharing sites give their services away in order to attract users, and put the difficult question of how to make money to one side. If you worry too much about a revenue model early on, you risk being left behind. Ultimately, though, every business needs revenues—and advertising, it transpires, is not going to provide enough. Free content and services were a beguiling idea. But the lesson of two internet bubbles is that somebody somewhere is going to have to pick up the tab for lunch. |
Open article at "The Economist" Web Site |
 Copyright © The Economist Newspaper Limited 2007. All rights reserved. |
viernes, marzo 20, 2009
Se repite la historia de Internet "gratis"..
Historia IT, no tan lejana.....
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| Información de Copyright y aviso legal © Fundación EROSKI | ||||||||
| COPYRIGHT © 2008 DePapaya.com All rights reserved. |
miércoles, marzo 18, 2009
Lectores de RSS (Real Simple Syndication)
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| COPYRIGHT © 2008 DePapaya.com All rights reserved. |
lunes, marzo 16, 2009
En tiempos de crisis, oportunidades de trabajo en Internet.
 Small Business. |
| In Hard Times, Freelancers Turn to the Web By DAN FOST Published: March 12, 2009 |
WITH layoffs mounting daily, the ranks of independent contractors appear ready to grow. People who have lost full-time jobs are seeking work on their own, and businesses that once hired full-timers and paid them benefits are turning to more affordable freelancers. Several online companies are easing the transition to a freelance economy for workers and employers. Freelancers in a wide range of fields can use sites like those operated by Elance, oDesk and Guru to advertise their work and bid on jobs; employers can use the sites to assemble a contract work force. Karen Swim, 45, of Sterling Heights, Mich., left a successful career in corporate marketing four years ago to write for a living. "I found Elance through a Google search," she said. "I was amazed. I thought, Oh my God, there's a whole underground of people making a living, and they're not going to a corporate office every day." Instead of donning a suit and knocking on doors, Ms. Swim discovered, "You could sit at your computer and within an hour create 10 to 15 proposals." Her rates — for copywriting, marketing and résumés — have climbed to $100 an hour after starting at $50, she said, and she has steady clients, both corporate and individual, in places like Australia, Ireland and Kuwait. Elance, of Mountain View, Calif., says that more than 233,000 contract jobs were posted on its site in 2008, an increase of 63 percent from 2007. And more than 50,000 people found work on oDesk in the fourth quarter of 2008, said the company, which is based in Menlo Park, Calif. The Web site Guru, based in Pittsburgh, said more than 180,000 freelancers were registered on its site, an increase of 25 percent over 2007. More than 14.8 million people were self-employed last year, accounting for about 12 percent of the private, nonfarm work force, according to Steve Hipple, an economist with the Bureau of Labor Statistics. As of January, according to the bureau, more than three million jobs had been lost in this recession. Steve King, a partner at Emergent Research, a research and consulting firm in Lafayette, Calif., that focuses on small businesses, said that in times like these, many people who can get jobs will grab them. But when résumés and applications go unanswered, he said, "people don't have a choice. I call them the accidental entrepreneurs. You start to see the growth in terms of self-employed." Gary Swart, the chief executive of oDesk, said, "We're seeing 5-to-9ers — people who have a day job but are looking to make some spare cash in their spare time — or stay-at-home moms." But the growth in the job sites does not mean that independent contractors are immune to recessionary forces. "Businesses tend to hold on to their employees," said Inder Guglani, chief executive of Guru. "With resources shrinking, they'll reduce freelancers first. The total dollars spent on freelancers in the economy, that's definitely contracting." But the online matchmakers say other trends are helping to offset that decline. Better bandwidth and newer software tools make remote work easier. "Businesses have figured out how to be comfortable with employees working remotely, and that has educated workers and managers," said Fabio Rosati, chief executive of Elance. The system at oDesk lets employers monitor contractors' work remotely. A boss can see when a worker is logged in, peek at a screen shot and even view the worker on a Web cam. With oDesk handling all the invoicing and payment, some companies are shifting the contractors they already have to oDesk. Rachel Pennig, manager of customer support for PBwiki in San Mateo, Calif., which creates collaborative wikis for clients, said she found at least half of her 12-member team on oDesk. One stay-at-home mother from South Carolina started as a contractor, kept increasing her hours, and wound up on the staff, she said. The sites all operate on the same principle as eBay, enabling workers to build their reputations. All the sites issue 1099 tax forms and other documentation, saving trouble for employers. The sites survive on fees, charging employers or taking a commission from freelancers' pay, often 5 to 10 percent. |
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| The sites all take a cut of the work, although each one works a little differently. Odesk takes a 10 percent charge on all services. Elance deducts between 6.75 percent and 8.75 percent from the payment, covering both its service fee and credit card costs. The range varies, depending on whether freelancers use the free listing service, or pay a one-time fee of $9.95 to $39.95. While Guru.com allows some freelancers to sign up for free, it charges a 10 percent fee on top of their billings. For freelancers who pay for premium services, ranging from $29.95 per quarter to $129.94 per quarter, Guru takes 5 percent of the total bill. Mr. King, the analyst, said he had also seen a rise in competitive sites serving narrower markets, like NineSigma and InnoCentive, tailored to the research and development field, or Crowdspring and Genius Rocket, which provide designers, or Rent A Coder, offering computer programmers. In addition, he said, the big sites continue to add features, largely to keep people from taking business connections offline to avoid the fees. For some people, working through these sites provides opportunities that would not be possible otherwise. Jessica Allen, 19, of Clarksville, Tenn., said she had found about 15 Web design jobs through oDesk in the past year, including steady work from Chicago and Alabama. Jobs involving graphic and Web design are not available in Clarksville, she said. Danny Guillory, chief executive of Innovations International, said he used Elance to round out his staff. He said the company, a human resources consultancy based in Salt Lake City and San Francisco, has 5 employees and 30 independent contractors, with revenue of up to $3 million a year. Mr. Guillory said companies needed to decide which unique services they offered customers and which features were essentially commodities that contractors could provide. "What is unique will remain in an organization's employee structure," he said. In his company's case, he said, it's the content — the lessons for customers. But delivering that content, he said, is something many people can do. "That can be commoditized," he said, and therefore he outsources it. His contractors also liked the arrangement, Mr. Guillory said. "People don't want to have one job and put all their eggs in one basket," he said. "The days of staying with someone for 30 years and getting the gold watch have been long gone." |
