Open Portals, Anti-Portals and the Wholesale Web

Prediction

Portals like AOL, MSN, Yahoo and Google will soon generate more impressions and ad inventory by providing their programming to third party websites then by serving retail traffic within their own domains.

The idea of internet portals morphing into "wholesalers" of programming to many thousands of "affiliates" should not be surprising. Wholesale distribution is the driver of nearly every major industry (from manufacturing to major media), and the television and film industries have worked that way for decades. NBC distributes its programming to loads of independent affiliates, so why shouldn't major web portals expand distribution beyond their own web properties? And from the perspective of most webmasters looking to invite user participation at their sites, programming complexity requires help from larger web players.

While portals like Yahoo and Google may capture dominant market share relative to other websites, their audiences are modest relative to the aggregate audience of niche websites across the internet. The universe of websites has a very long-tail, and soon it will be clear that earning real estate on those websites will be the primary mission of every major portal. Open Portal or Anti-Portal may be the best ways to describe this new animal.

User-generated content plays a central role

Perhaps there's nothing all that radical about syndicating content on the web. Video distribution has become fairly common, and there are a number of companies (like BrightCove and thePlatform) making it easier for content aggregators. But the syndication of traditional media is not enough to validate my outrageous prediction. A portal platform designed only to distribute video files is just not that interesting—the internet is by nature an interactive place. User participation is the key ingredient driving consumer traffic and, in the context of portals distributing programming to 3rd party websites, any definition of programming that includes only traditional media content is far too narrow.

Context will drive the next evolution of user-generated content and social networking (among other Web X.0 features), and that context will be expressed thru many thousands of niche-oriented websites, from major media websites to local radio, high school and family websites. Whether those niches are primetime reality television show websites or high school URLs, the winning solutions will blend premium and long-tail UGC within the many sub-contexts of individual websites.

By way of example, Major League Baseball will want to blend vintage footage of Babe Ruth on highest rated lists at MLB.com with highest rated Little League videos uploaded by 14 year-old fans and their parents. Or MLB.com will present a list of junior girls soccer videos alongside a premium content story about Mia Hamm. In any case, user participation blended with premium content will soon define the total experience within specific contexts and sub-contexts on many, many websites.  By the way, MLB also may also want to power, brand and distribute content to every Little League website in the country---enabling all these microsites is part of the challenge.

The only thing standing in the way is the difficulty of web developers effectively building the kind of complex backend infrastructure and media management necessary to support these user-driven experiences.

So how might this fancy new portal platform work?

Imagine if a portal like Yahoo took the initiative of providing any 3^rd party website open access to a wide range of hosted programs (with both traditional content and user participation functionality). The Yahoo affiliate platform would invite webmasters to browse for programming that improves their user experience, thus creating incremental traffic and ad inventory for both Yahoo and their affiliate websites. Programming would include user-generated content and social networking functionality, Flash video players, media-enabled banner ads, online games, a selection of live events, short video programs and everything else available from Yahoo's existing "retail" verticals. All programming would be supported by a seamlessly integrated media management system, complete with administration, transcoding, hosting, reporting and data mining services.

Widgets will no doubt be the fastest and most customizable way for webmasters to implement Yahoo syndicated programming. But these widgets will go beyond the skin-deep objects we've seen thus far (e.g. chat, video blogging). That is, most of the functionality would present itself to end-users at 3rd party website after they've clicked thru these deep widgets to more full-featured page experiences (branded to 3rd party websites, but "powered by Yahoo") with web services allowing customization and seamless integration of these experiences on affiliate websites. The widgets themselves (whether Flash, HTML and/or AJAX enabled) will be customizable by web developers with just a few clicks at Yahoo's affiliate center.

Portal distribution platforms will be even more ambitious than those provided by ASP trailblazers like Salesforce.com. Think of them as fully hosted tinker-toy sets for webmasters. Application frameworks like Ruby on Rails provide a half-step in this direction—what I'm describing is a fully hosted platform far more abstracted and non-technical than any programming language. The platforms, themselves, will be built on sophisticated, service oriented architectures, and may make use of JBI and other powerful messaging technologies. By contrast, deployment of hosted programming on affiliate websites will be trivial.

By elegantly blending off-the-shelf, hosted programming with their own premium content and personality, webmasters can quickly implement complete solutions with minimal engineering support and cost. Implementation of feature rich hosted programming will take hours, not months, and the only price to affiliate websites will be sharing some ad inventory with their portal provider—just as local television affiliates share ad inventory with the major networks.

Impact on internet advertising

This portal syndication model will have tremendous impact on internet advertising. In a very real sense Google's Adsense program is already embracing the concept of capturing real estate on third-party websites. The only difference is that Adsense is capturing real estate with advertising alone—zero programming! Imagine if NBC announced that there would be no Fall Lineup for its independent affiliates—just ads this season. How many of those stations would remain NBC affiliates? Zero is a safe assumption.

The implication is that soon as other ad networks begin to level the technology playing field (which is inevitable), Google will have to begin earning that Adsense real estate by providing their affiliates with programming that makes sites more sticky and viral. In fact, the Google Apps program is a first step in that direction. No surprise to me. Google is, after all, a very smart company.

Major media

Traditional web portals will not be the only companies interested in distributing programming to third party websites. Major media brands like MTV and Sports Illustrated will discover that their brands are powerful enough to live outside their own web domains in a more meaningful way. And the programming they provide third party websites will go far beyond traditional content, and will include hosted services that enable deep user participation. For example, it's easy to imagine MTV providing a turnkey "Powered by MTV" hosted service that enables every musician, record label and music-related website with user-generated content functionality, live events and other programming. Similarly, it's easy to see why it will be compelling for SportsIllustrated.com to provide every local Little League website their very own "Powered by SI" social network.

The promise

My predictions are all very self-serving, I'm ashamed to admit. My company, KickApps Corporation, has set out to build the kind of platform I've described in this blog entry. But there will certainly be others, and that's a good thing. The promise of Web X.0 requires that we increasingly make building amazing user experiences as easy as it is to use these experiences. The line between user and web developer will continue to blur as surely as the line has blurred between content creator and content viewer. Web developers that seek to fully empower their site visitors will need lots of help from platform companies focused on making their jobs easier.

Comments

[Mario Hemsley]

Wow! I totally, TOTALLY, agree, and now I have to thank you for your in-depth discussion. I had many of these ideas before being introduced to KickApps by Masternewmedia.org, but you have stimulated many new ideas. I will be studying everything you said to be able to spread the word in as eloquent and complete a way in an upcoming vlog. I will be sure to credit your article as a source of inspiration. As a designer of “theme-based micro-niche neourban internet television networks”, I have just completed the first draft of 64 Ning sites to act as social network companions to my channels. All the while I was working, I continued to look out for tools to allow the same kinds of social networking and widget technology to be EASILY added to my existing sites, and YOU seem to be it. After looking around KickApps all day (I got hooked), I am now planning on using your platform as the main one for my website upgrades. Now they can be as happening as the MySpace and Ning sites I have done. The truth is I probably wouldn’t have done the Ning sites if I had found you first. I started building the Ning sites within 24 hours of the platform launch!
Bottom Line: Look for KickApps to be featured throughout the Pax Stereo NeoUrban Internet Television Network

Thanks for being THAT tool to take us all to this needed next level. Good luck with your enterprise.

Sincerely,

Mario R. Hemsley, MD
CEO Pax Stereo

[Mario Hemsley]

Wow! I totally, TOTALLY, agree, and now I have to thank you for your in-depth discussion. I had many of these ideas before being introduced to KickApps by Masternewmedia.org, but you have stimulated many new ideas. I will be studying everything you said to be able to spread the word in as eloquent and complete a way in an upcoming vlog. I will be sure to credit your article as a source of inspiration. As a designer of “theme-based micro-niche neourban internet television networks”, I have just completed the first draft of 64 Ning sites to act as social network companions to my channels. All the while I was working, I continued to look out for tools to allow the same kinds of social networking and widget technology to be EASILY added to my existing sites, and YOU seem to be it. After looking around KickApps all day (I got hooked), I am now planning on using your platform as the main one for my website upgrades. Now they can be as happening as the MySpace and Ning sites I have done. The truth is I probably wouldn’t have done the Ning sites if I had found you first. I started building the Ning sites within 24 hours of the platform launch!
Bottom Line: Look for KickApps to be featured throughout the Pax Stereo NeoUrban Internet Television Network

Thanks for being THAT tool to take us all to this needed next level. Good luck with your enterprise.

Sincerely,

Mario R. Hemsley, MD
CEO Pax Stereo

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