The Guardian: Will online content find a market?

By David Rowan

A penny for your thoughts. Or, depending on your pricing structure, 5p or £5, chargeable per minute and billable to other people's credit cards or phone bills. You're an expert, you see, and all that separates you from customers willing to pay for your specialist knowledge - on finding a reliable builder, perhaps, or overcoming baldness - is a website which allows them to find you.

Wait no longer: "expert exchange" websites are the latest hot business models heading our way. Drawing on the internet's extraordinary ability to link individuals to their peers, these "peer-to-peer" sites do for specialist knowledge what Napster does for music and eBay for car-boot junk. By restoring human guidance to the tricky business of researching information online, they have built strong traffic by finding individuals who can answer other people's questions. Yet there is one question that, even at a premium, these sites cannot yet answer with confidence: will enough people be willing to pay for web-delivered content to make a viable long-term business?

There is no shortage of sites trying to find out. AskMe.com promises "great answers from real people" in categories ranging from pets to the paranormal (currently recruiting experts in the Olympics, MP3 and Rosh Hashanah). Exp.com offers "real experts; real help" on subjects including US immigration law (advice at $1.10 a minute) and marathon running.

Search engines think there's money to be made here: Ask Jeeves was among those which put $33m into Exp.com in a recent funding round. Yahoo has also entered the market, with experts.yahoo.com, featuring such specialists as "Roumster", a 25-year-old woman keen to talk about dating problems. The New York Times has its own "knowledge network", Abuzz (top questions: what really happened to that Russian sub and whether geraniums work as house plants). KnowPost.com promises "meta-knowledge" on the Wizard of Oz and web-browsing technology.

Many of these sites rely on advertising as their business model, others customise their services for corporate customers. But it is the convergence of web and telephony that is currently exciting investors. Two phone-enabled expert exchanges are coming to London, betting on our willingness to pay by the minute to talk to specialists.

Keen.com, a San Francisco-based start-up that claims to be "the live answer community", has joined with Benchmark Capital in a $15m investment to form Keen Europe. Users will browse its subject listing, choose an expert, and then click on a "call now" button - and the site connects both parties by phone, taking a 30% commission on the call fee. Ten months after launch, parent site Keen.com claims 500,000 members, with 1.4m unique monthly visitors.

Up against Keen is Questico.com, a DM14m (£4m) German start-up founded in April that is soon to launch in the UK. The company claims to combine "the Internet's advantage of speedy information retrieval with the opportunity to instantly take part in a one-on-one dialogue over the telephone, putting an end to the long and difficult search process one often encounters". As with most of these sites, users rate the experts once they've bought the advice to ensure some measure of quality control.

These sites also benefit from the willingness of users to spend money on the telephone: premium-rate calls, after all, have been among the main money makers for companies such as the 365 Corporation, and relatively high per-minute call charges have not dented the growth of the mobile-phone sector. What is really exciting the investors is the mobile's promise to become the major means of accessing the internet in a year or two.

Keen.com's chief executive, Karl Jacob, has a vision for these information exchanges. "What eBay did for people selling what's in their garages and attics, Keen.com will do for people who want to sell what's in their heads," he says. The idea is attractive but what will determine the future of these sites is our willingness in enough numbers to abandon that tenet of web use: the public does not like paying for content.

"Every single site in the world that has tried to charge for content has rejected it - except the Wall Street Journal," notes James Ledbetter, newly arrived in London from New York as editor of the Industry Standard Europe. "The brilliance of Napster is it's free. To introduce that [peer-to-peer exchange] on a paid model is admirable, risky, but I suspect for a lot of people doing it, not ultimately successful."

I'm not so sure: for very specific information that can be delivered digitally or by phone - tips on a business plan, for instance, or professional advice on a medical problem - customers will be willing to pay a premium. And if you're still not convinced, for £1 a minute I'd be happy to tell you why.

(The Guardian, September 25, 2000)

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The Guardian: The dotcom death pool

Pay your rent, pay your employees, spend less than you earn and come up with a good idea. That way your e-business may avoid an appearance in one of a rash of sites specialising in blowing the whistle on dead and dying dot.coms. By David Rowan

Failure has its price. For Philip Kaplan, that price hovered last week anywhere between tens of thousands of dollars and $10m. As founder and owner of dot.com deathwatch site FuckedCompany.com, a satire of the gung-ho business magazine Fast Company, Kaplan has discovered how to capitalise on the latest new-economy trend: chronicling the terminal decline of other websites.

Visitors to the site place bets on which companies they believe will be next to fire staff, restructure or ultimately close down, and points are awarded each time the bad news is confirmed. As the rules state, "a company is officially 'fucked' when they do something that signals - or attempts to correct - impending doom", with one point awarded for minor layoffs, and 100 for "an all-out corporate slaying". Beyond the game, however, it is the 300-400 daily "news tips" from readers that have attracted almost 6m page views each week, from more than 124,000 unique users, seeking news and rumours of the latest failed start-ups.

That is the sort of traffic most companies listed in the "deadpool" would have paid millions to acquire - which is why, last week, Kaplan decided to auction his site on eBay.

A $10m bid later proved a hoax, but Kaplan says his whimsical decision to sell - because he was "bored" running the one-man site in his spare time - is attracting some genuine offers from serious players. "I have a few offers ranging from $500k to $3m, and am discussing terms with all of them," he says. He admits that he has moved away from his original pledge on the site that "I don't make - and don't plan to make - any money from it" and now insists that "the future of the site is very important to me - not just the money".

Certainly there appears to be no shortage of candidates for inclusion in the site's message boards. The demise of boo.com, clickmango and APBnews.com may have made headlines this summer, but Kaplan's site, and a growing number of rivals, would wish to remind you that the list also includes Auctions.com, audiocafe.com, BBQ.com, beautyscene, carOrder.com, CookExpress.com, CraftShop.com, FooFoo.com, freewwweb, Gazelle.com, Hardware.com, Reel.com healthshop.com, living.com, Pandesic, Petstore.com, Pixelon, toysmart.com and Value America - followed by an ever-growing list of others.

You can study a fuller list on FuckedCompany's sister site, dotcomfailures.com (motto: "Kick 'em while they're down"), whose "dead list" claims to be definitive, and whose rumour boards were last week alleging that Oxygen and Urbanfetch may ultimately be joining them. Coincidentally, dotcomfailures.com was proud last week to lead its front page with news of its own closure, "three months and $2.6m (actually it's closer to $140) later..."

Ryan Nitz, the man behind dotcomfailures.com (and a friend of Kaplan), had a simple reason for closing the site: "I'm not having fun any more," he explains. "I want to contribute more positively to the industry. It's really easy to point out the weaknesses of others; learning from the mistakes of others and building a company are very difficult tasks." Now, he says, he wants "a more honest challenge", in which he will apply his knowledge of company failures to his own business "and hopefully will not make the same mistakes".

That, however, will not silence the rumour-mongers. They can still post their unverified claims on dotcomdoom.com, which claims to be "the largest portal on the downturn, demise and doom of dot.coms", but in fact turns out to offer a combination of web search results and news feeds supplied by Moreover.com. More worrying for the PR departments of hard-hit start-ups is Need to Know , the "weekly hi-tech sarcastic update for the UK", which regularly publicises the winners of its Falco award. A Falco - named after the late Austrian techno-rap singer whose greatest hit was Rock Me Amadeus - is given to those who correctly predict the demise of technology start-ups. Recent winners predicted the problems of the-bullet.com and recordtv.com, as well as a site called Flake.com, a portal for those interested in breakfast cereal. "I like breakfast cereal like the next guy," noted Need to Know's author, "but sites like these make me so angry - not to mention VCs 'venture capitalists'; who support crap like this." It currently predicts a future Falco to those who back Bango.net, "which owns what has to be the dumbest idea we've heard since Real Names. Real Names, you may recall, was the plan to replace domain names with . . . more names. Bango's ruse is to replace domain names with numbers 'for Wap phones'."

So how can a company avoid being F***ed - the cautious way US newspapers refer to the practice? "Easy question, easy answer," says Philip Kaplan. "Pay your rent, pay your employees, spend less than you earn, and - most importantly - come up with a good idea, and do it first. Just like any other business." Ryan Nitz also counsels caution over extravagance: "Trim the fat and be realistic," he says. "Experience is probably one of the best resources you can purchase in this industry."

They can also learn from the examples of leaked memos and press releases, archived on the sites, which could only ever hinder their companies' prospects. This one, for instance, which FuckedCompany.com calls "the best press release ever": "All of the directors and officers of US Digital Communications, Inc have resigned, effective immediately. Presently the company has no employees, officers, or directors. The corporation has no assets, no revenues, and no money to continue in business. In addition, the corporation does not have the capability to transact business in the future." Concise, if somewhat futile.

Others, however, question just how helpful the dot.com death-watchers are once the joke wears off. Nicholas Hall, whose site StartupFailures.com calls itself "the place for bouncing back", says they provide no lasting benefit simply by showing "that someone else is worse off than you". "Society has certainly created a space for the doom-mongers, but I don't believe they make a positive contribution to our society," he reflects from his base near San Francisco, where he is president of the Silicon Valley association of software entrepreneurs.

Hall's site - which resulted from his own three failed start-ups, in the web, drinks and financial-services industries - is building what he hopes will be a successful business out of supporting those who have failed. It offers job listings, "entrepreneur coaching" and discussions of lessons learned, as well as community support that battles the stigma of failure (as the site pro claims, "the only true failure is never trying"). "I believe in the spirit of the entrepreneur and want to do what I can to continue to foster that spirit," Hall says defiantly. He does not see FuckedCompany.com's current strategy as necessarily helpful. "To me, they are attempting to cash in on a hot property. I can't blame them for trying, but to put the site up for sale on eBay because they are bored..."

Kaplan, meanwhile, says he has no worries about the other competitors entering his space. "We're seeing the shakeout of day-late, dollar-short FuckedCompany.com copycats," he notes bullishly. "Ironically, FuckedCompany.com proves the point that there's only room for one. Original, well thought-out ideas will be rewarded and impostors won't last."

(The Guardian, September 18, 2000)

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