November 30, 2012 | Posted in:Uncategorized

Advertising driven information services
Most products and services related to information, media, publishing are either already freely available or are headed in this direction. Any internet business trying to resist such a model subjects itself to high risk of becoming extinct. Service providers that try to charge end users for customized information are likely to see their margins eroding fast depending on

  1. Awareness or lack of it among its own user base
  2. Barriers other than technology to enter local markets
  3. Ability or lack of it to provide any value added functionality or service compared to the free tools.

Simple reason of such harsh results is free availability of superior tools from larger and more profitable organizations built on top of their superior existing information aggregation, search and analysis platform while leveraging their ever increasing syndicated user base. They survive and profit from advertising in their large network of users and use this money to build smart tools for free which in turn brings in more users.

The time line to extinction for such products is quite unpredictable in my view and can vary between a few weeks / months to at most an year depending mostly on user awareness/local competition.

Recent examples
www.techcrunch.com/2008/04/18/encyclopedia-britannica-now-free-for-bloggers/

blogs.newsgator.com/inbox/2008/01/newsgator-inbox.html

Developing specialized applications and services for the enterprise
Even nice tools and softwares built for this segment of the market are distributed free these days by large software houses to gain internet audience which in turn drives revenues through adverstising and adding more users.

User base is the key asset
Regularly visiting users and thriving user communities can be considered as the key asset of any internet business.

So how can we really make money in this space despite being small and the answer in short is realignment

Its a few billion dollars question and the list of probable answers are in hundreds if not thousands. A few generalized observations on my part areBetter tools / services for the mobile market – A wide range of devices, platforms, user taste make this a open field for anybody with a decent application to gain user acceptance.

 

Moving from generalized information aggregation space into specialized information management services and developing tools required for it.Ability to gather offline local market data and providing statistical predictive services.

 

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