1. MoContent,MoProblems:Google’sFrommer’sAcquisitionCouldLeadToAdditionalAntitrustScrutiny
Monday, August 13th, 2012
―There is a fundamental conflict between being a search provider and a content provider,‖
said John M. Simpson, Consumer Watchdog’s Privacy Project Director. ―As Google has
increased its content and services, it has unfairly favored them in its search results and
damaged competitors.‖ The deal, says Simpson, means ―Google executives are thumbing
their noses at regulators‖ and ―if it is allowed with conditions, there is absolutely no reason
to believe the Internet giant will live up to it’s word.‖
The FairSearch.org group, which counts TripAdvisor, Expedia, Kayak and Microsoft
among its members, also just issued a statement in which it ―encourages government
officials to look closely at its ability to use its dominance in search and search advertising
to steer users away from competitors in order to keep users on Google’s own pages
longer, and the potentially devastating effects that could have on the online economy.‖
It’s worth noting that a number of companies – including some that could be considered to
be Frommer’s competitors – have accused Google of highlighting its own content over
that of its competitors in its search results over the last few years. Last year, for example,
Yelp CEO Jeremy Stoppelman told the Senate Judiciary Committee that he believes
Google has abused its market dominance in search. Earlier this year, Nextag CEO Jeffrey
Katz, one of Google’s most outspoken critics, wrote an op-ed piece in the WSJ in which
he noted that the company ―needs to become more transparent about when advertisers
get better placement in search results and when a result is a Google-owned property.‖
With more of its own content to highlight on Google Search, chances are Google will
indeed face additional pressure from antitrust regulators to ensure that it doesn’t give
preference to its own content on its search results pages. Google, of course, argues that it
simply tries to provide the best search results for its users but chances are that the
executives over at Rough Guides, Fodor’s and Lonely Planet would have preferred to see
Google stay out of the travel content business.
http://techcrunch.com/2012/08/13/google-frommers-antitrust/
Every company's dream is to become the world's most dominant company. A startup's goal is to survive. A
small-to-medium sized company's goal is to become a large company. A large company's goal is to become the
world's largest company and so on.
Whenever a large company has a lot of power, they will always try to stop the startups and small-to-medium
companies from becoming larger ones. You can look back at history and find many instances of this theory, for
e.g. Microsoft did this to Netscape, Google did this to Yelp/Dropbox, Facebook did it to Friendfeed/App.net,
2. Twitter did it to Tinyurl/Twitpic etc. They can either do this by acquisition (legal), direct competition (legal) or by
abusing their power of monopoly in their existing businesses (illegal).
However, the larger companies (as of now) have also faced these exact same hurdles when they were trying to
get bigger. That's how capitalism works. As Bill Gates famously said: "Life is unfair, get used to it".
Google Buys Frommer’s Travel Guides in Yet Another
Contested Move as a Content Publisher
Miranda Miller, August 21, 2012
Google acquired Frommer‘s brand of travel guides from Wiley & Sons last week, in a
dealreportedly worth $23 million. While the actual acquisition is small by Google‘s
standards, it is another big indicator Google plans to continue building their business as a
publisher of unique content.
Wiley‘s announcement of the sale read, ―On August 10, 2012, Wiley entered into a
definitive agreement to sell all of its travel assets, including all of its interests in the
Frommer's brand, to Google.‖
―The Frommer‘s team and the quality and scope of their content will be a great addition to
the Zagat team,‘‘ a Google rep told the Financial Post. ―We can‘t wait to start working with
them on our goal to provide a review for every relevant place in the world.‖
Yelp Stock Down in Light of Google-Frommer Acquisition
At one point, Frommer‘s were the premier travel guides; that is, until Lonely Planet came
along to dominate the scene. Google reportedly plans to combine Frommer‘s with their
Zagat reviews. Last year, Google acquired Zagat and earlier this summer, integrated
Zagat reviews with the merged Google+ Pages/Places.
Google‘s foray into publishing local reviews is bad news for Yelp, whose stock plummeted
after the announcement. Yelp was sitting at $20.17 a share as of this writing, substantially
down from their 52-week high of $31.96. Just before Google announced the Frommer‘s
deal, Yelp was trading at over $26.
Google used to pay Yelp in order to use their reviews on Google Maps. That ended when
Yelp became unhappy with what they said was Google‘s practice of promoting their own
pages over those of others.
Google actually tried to buy Yelp in 2009, though the deal didn‘t go through. By
September 2011,Yelp was testifying against Googlein the Senate Subcommittee on
Antitrust, Competition Policy and Consumer Rights.
3. Consumer Watchdog, FairSearch.org Asking for FTC Intervention
Yelp aren‘t the only ones unhappy about the Frommer‘s deal. Consumer Watchdog is
calling on the FTC to block the acquisition.
"There is a fundamental conflict between being a search provider and a content provider,‖
Consumer Watchdog Privacy Project Director John Simpson told The Inquirer. ―As
Google has increased its content and services, it has unfairly favoured them in its search
results and damaged competitors. It makes absolutely no sense to approve this deal.‖
FairSearch.org, a group of companies including Microsoft, Expedia, and TripAdvisor,
among others, released a blog post about Google‘s latest acquisition. It read, in part:
―As Google expands beyond general search into content development in key search
verticals, FairSearch.org encourages government officials to look closely at its ability to
use its dominance in search and search advertising to steer users away from competitors
in order to keep users on Google‘s own pages longer, and the potentially devastating
effects that could have on the online economy.‖
Can Google Do Fair Search and Create Content?
Forbes staff writer Jeff Bercovici doesn‘t think it‘s even a question whether Google has
become a media empire. He takes a stab at what Google will do with Frommer‘s in a
recent article:
―...the obvious guess is that Google will Zagat-ize Frommer‘s, de-emphasizing
professionally-produced content in favor of user-gen stuff, which is both cheaper to
produce and more in keeping with its traditional competencies. For the moment, however,
Google is, at least in a small way, unarguably a media company.‖
This raises the obvious question, he says; one that has been on the minds of many as
complaint after complaint has rolled into the FTC: ―How long can Google be a fair arbiter
of all the world‘s information when it increasingly has information of its own that it wants to
promote?‖
The New York Times published previously unpublished quotes from Eric Schmidt, who
was CEO at the time he is reported to have given the interview in 2010. According to the
NYT, Schmidt said Google is ―careful to define a line where we don‘t cross into content‖
and wanted to remain a ―neutral platform for content and applications.‖
That line seems to blur more every day. Whether the FTC will heed the warnings of
groups like Consumer Watchdog and FairSearch.org remains to be seen. For now,
companies like Yelp and TripAdvisor have every reason to feel threatened, as the giant of
the web encroaches further into their business model.
4. http://searchenginewatch.com/article/2199939/Google-Buys-Frommers-Travel-Guid
es-in-Yet-Another-Contested-Move-as-a-Content-Publisher
With Frommer's, Google Taps Gurus
By AMIR EFRATI And JEFFREY A. TRACHTENBERG
Updated August 14, 2012, 3:54 a.m. ET
Google Inc. GOOG +0.50% for years swore it wasn't interested in creating
content, choosing instead to point people to information on the Web.
Google also championed the vox populi, letting crowd-sourced opinions
bubble to the top when users search for answers online.
Slowly, though, the experts have been moving up in Google's eyes, and
its business.
Google is buying the Frommer's brand of travel guides from publishing house John Wiley &
Sons for an undisclosed price, Jeffrey Trachtenberg reports on digits.
On Monday, Google said it is acquiring the Frommer's travel-guide
business in a bid to attract more advertising dollars tied to online-travel
bookings and local-business information. Google is buying Frommer's
from publisher John Wiley & Sons Inc. JWB +0.67%
Google paid around $25 million for Frommer's, according to a person
briefed on the deal, which hasn't yet closed. But the deal is more
significant for its strategy than its price tag.
By owning Frommer's travel-guide content and showing it in search
results, Google could sell travel-related ads against it and provide more
tools for people to book travel arrangements.
The Frommer's deal follows Google's 2011 acquisition of Zagat Survey,
whose reviews and ratings of millions of businesses have since been
incorporated into Google+ local-business listings. Google said Monday
that the Frommer's brand would be melded with the Zagat brand.
Frommer's data about local businesses around the world could boost the
Google+ business listings—where both Zagat ratings and individual
customer reviews are displayed—and Google Maps.
5. With Zagat and Frommer's, Google is betting it can become a trusted
guide for travel and local-business information by using expert ratings
and aggregating online comments from thousands of customers, the way
Yelp.com and TripAdvisor.com do.
Frommer's is more evidence that Google has grown fonder of
professionally produced content. There are other examples: It recently
took an equity stake in Machinima Inc., which creates video content
mainly for Google's YouTube video site.
A Google spokeswoman declined to comment.
In addition, Google is investing more than $350 million to help create and
market professional-grade videos for YouTube, located on special
"channels," as the site upgrades its offerings from the simple
user-generated videos of its roots.
A separate content effort, though—Google's Knol online encyclopedia,
which took contributions from experts—wound down this year as Google
CEO Larry Page killed off some underperforming services.
In addition to owning content, Google also is trying to become "vertically
integrated" in terms of mobile devices. Google's strategy for years was to
allow manufacturers to use its free Android operating software, helping
them compete with Apple Inc. gadgets and ensuring that its search
engine would be built into the devices. But Google recently bought
handset maker Motorola Mobility and has embarked on an effort to build
its own mobile devices.
The Frommer's deal could put Google at odds with other website
publishers. In recent years, Google has expanded its array of services
6. that seek to directly answer users' queries, departing from its original
strategy of sending them quickly to the most relevant site. For example,
people who search for local-business information now often see links to
Google+ business listings—and Zagat ratings—in the search-engine
results above other sites like Yelp.
Google—and its ambitions to capture more online ads related to travel
and local-business information—are under scrutiny by antitrust
authorities, who are looking into allegations that the company directs its
search-engine users to its Google+ business listings, undermining travel
and online-review sites such as TripAdvisor and Yelp. The Frommer's
deal is too small to trigger an automatic review by antitrust authorities.
Google has denied any anticompetitive practices and has repeatedly said
it creates its services to benefit users, rather than other websites. Some
U.S. courts have agreed with Google's assertion that its search-engine
results are a kind of opinion that is protected by free-speech rights.
Stephen Kaufer, the CEO of TripAdvisor Inc., TRIP -0.80% said Monday,
"It is puzzling to us that Google is going backwards to the opinion of
one—a writer—when TripAdvisor is proof that travelers like the wisdom of
crowds" and their social-network friends.
Mr. Kaufer, who has spoken out about Google's practice of pointing users
to Google-owned sites, added: "I absolutely worry that Google will
preference Frommer's content above organic search results to the
detriment of the users' experience and the enrichment of Google."
Yelp Inc. YELP +1.43% declined to comment.
TripAdvisor shares fell 4.6% in Monday trading; Yelp's stock dropped
7.7%.
Google in 2010 made its first big foray into the travel industry by acquiring
flight-data company ITA Software, which powers the flight-booking tools
of numerous websites.
Last year Google launched its own flight-booking service.
7. Google generates about $2 billion to $3 billion per year from selling
travel-related ads on its search engine and hotel- and flight-booking
service, with travel sites Expedia Inc. EXPE -0.23% and Priceline Inc. being
among the top advertisers, according to Herman Leung, a stock analyst
at Susquehanna International Group LLP.
The U.S.-based leisure-travel industry spent $2.56 billion on online
advertising last year, up 40.6% from a year earlier, according to research
firm eMarketer Inc. Last year U.S.-based travelers spent more than $100
billion to book trips online, a figure that is expected to grow by around
10% annually, eMarketer said.
Google said Monday it hasn't yet decided whether the Frommer's
guidebooks will continue to be published in print or whether they will
eventually migrate entirely to online.
Flight Deck
Google's travel and content acquisitions
July 2010: Announced acquisition of flight information software company ITA Software
for $700 million. Last year Google launched its own flight-booking service.
Sept. 2011: Purchased Zagat review guides for $151 million. Reviews have since
been incorporated into Google+ local-business listings.
Aug. 2012: Announced acquisition of the Frommer's travel-guide business, paying
less than $66 million.
"Our commitment is to keep things as they are today and once we
combine operations, we'll know better what the future looks like," said
Bernardo Hernandez, a director of product management within Google's
Zagat unit.
"Consumers need fresh, accurate information," Mr. Hernandez said.
"When you add information you can trust to phone numbers and
addresses as part of the Google search experience, it enables users to
convert their intentions into actions," meaning to book travel online.
Wiley, which has owned Frommer's since 2001, said it intended to sell
the brand in March as it no longer aligned with its long-term strategies.
Frommer's dates back to 1957, when Arthur Frommer, founder of the
Frommer's series, published "Europe on Five Dollars a Day."
8. Bill Newlin, publisher of Avalon Travel, an imprint of the Perseus Books
Group that publishes travel expert Rick Steves and the Moon branded
guides, said he wasn't worried about Frommer's titles getting an unfair
advantage in Web search.
"There's only one way to spell Rick Steves," he said.
http://online.wsj.com/article/SB10000872396390444772404577587131075164366.
html
How Google’s Acquisition of Frommer’s Will Shake the Travel Industry
Posted by Kathryn Armson & Andrew Berriz (@andrewberriz) / August 20, 2012 3:23 pm
The travel industry‘s visibility in search changed dramatically last week. As of last Monday
morning, Google has purchased Frommer‘s Travel Guides. CM‘ers across our office rejoiced
realizing just how big of an impact this buyout could have on the traveler‘s experience.
In 2011, 69 percent of users looking for travel related information went to the search engines to
find online content. Currently controlling 66.8% of all U.S. searches, we see that when
Google makes a change, the majority of online users have no choice but to follow.
With Google‘s most recent acquisition of Frommer‘s the travel industry may be on the
threshold of big changes. How will these changes affect your travel company‘s search
rankings and website performance?
Google monopolizes the traveler’s journey
Over the past several years Google has begun expanding its capabilities beyond those of a
standard search engine. When Google was originally founded, their goal was to accurately
direct users to the websites most relevant to their needs. The idea was for a user to spend as
little time on the Google site as possible. A searcher would type in their search query, and in
the perfect scenario would be directed to the most relevant content to their query without ever
having to scroll down the page.
However, as Google expanded their technology and began to monetize on-site
advertisements and searcher behavioral research it seems the goal was now to keep users on
Google owned properties as long as possible. Google recently rolled out ‗knowledge graphs‘,
grids powered by rich-snippets that appear on the Google search results pages for
informational-based search queries.
9. The ink is still drying on the contract, and it is unclear exactly how this latest acquisition will
affect websites competing in the travel industry. However, there are a few things your
company can do to prepare yourself for any impending changes Google may release.
What You Can Do to Prepare
1. Keep Users at Center
The number one action you can take to protect your site from being severely affected by any
future Google changes is to always aim to provide value to your users. Sites like Pinterest
have shown us that an intuitive user interface, and wealth of valuable content is always more
effective at driving traffic than a flashy, complex site. Another great example of a site that aims
to satisfy the user instead of Google is Twitter. The interface is simple, with only a few
capabilities, but the wealth of content related to celebrities, top news, local events and more is
delivered directly to the user in a timely fashion.
It‘s easy to lose sight of the end user, and try to find the ―silver bullet‖ that will quickly propel
your site to fame in that #1 search result spot. However, past Google updates (Panda being a
prime example) have shown that sites trying to manipulate the algorithm, social networking
sites or content schemes for quick wins will ultimately fail. Provide your users with the
information they are looking for in an easy-to-navigate site will more quickly build user loyalty
drive traffic flow to your site. Investing the time and money upfront to truly understand your
consumer and their online behaviors is always the best strategy.
2. Embrace All SEO Tools
Sites in the travel industry should also utilize rich snippets, and basic marketing skills to
make their sites more visible and appealing in the search results pages. Be sure all Title
Tags and Meta Descriptions on your pages are optimized, not just for the search engines, but
to fully inform users and help increase click-though rate. Embracing recent technology, such
as Schema.org, to transform your regular search engine results into interactive rich snippets,
with imagery, videos and product information embedded right into the search results page can
help your site stand out, as well.
3. A Holistic Support Strategy
Finally, travel sites should work to embrace many different facets of vertical search and
online advertisement. If your site relies solely on SEO performance, one big change from
Google and you may see your site‘s traffic drop severely. Aim to produce content that performs
well in image search, news search, and blog search, while also building up a large user base
on social media sites and driving traffic through paid media.
Final Thoughts – The Scramble for Quality Travel Content
The online travel marketplace is infamous for a high “look-to-book ratio” – an astounding
4,500 to 1 – which basically says travelers are doing a lot of searching, researching, and
10. comparing before selecting a destination and booking their vacations. The question for traveler
markets is how to capture and convert those travel shoppers.
The buyout of Frommer‘s and potentially heightened prominence of their travel content in
search results accentuates the call to arms for travel brands to up their game. Sheepishly
cowering to the massive players cannot be your answer. As the sheer quantity of travel-related
content grows, travel brands are hustling to develop more compelling content to improve
search visibility. Boldly claim a distinctive voice among the crowds to hold an essential role.
Share content about the local culture and cuisine, for example, in addition to speaking about
your brand. If they can‘t find the information anywhere else, you‘l live to tell the tale of another
day in this competitive industry.
http://experiencematters.criticalmass.com/2012/08/20/how-google%E2%80%99s-ac
quisition-of-frommer%E2%80%99s-will-shake-the-travel-industry/
WHY IT WOULD BE A MISTAKE FOR GOOGLE TO KILL FROMMER’S TRAVEL GUIDES
By buying a travel guidebook publisher solely to bolster its local search content, Google risks both
straddling itself with an unprofitable albatross and missing out on a way to differentiate itself from its
rivals.
Google’s recent acquisition of Frommer’s has given rise to much comment about the ―real‖ intentions of
the Big G and what this means for other travel publishers. While it’s less entertaining than some of the
theories floating around, for time being I’m willing to accept their stated rationale at face value: just
another stepping stone to ―provide a review for every relevant place in the world―, and thus a tactical
move to bolster local coverage for the ailing Google+.
There are, however, two fundamental problems with the purchase and this goal that do not seem to have
garnered much attention.
Frommer’s claims ―4,500 destinations, 50,000 images and 300,000 events―, but they leave unsaid the
source of every one of those bits of data: their own printed guidebooks. Google thus has an unpalatable
array of choices:
1. Keep producing printed guidebooks and digitizing the incoming content as usual. This is clearly
Google’s starting point, as they will be retaining Frommer’s print staff, but it’s also almost certainly
a money-losing proposition: given the fire sale price of barely over 1x revenue, there’s no way the
books are making money. With the overall travel guidebook market declining by 10% year and the
new owner focused on entirely different things, a turnaround seems fanciful. Google will thus be
looking to jettison them as soon as it can, which leads us to the next option:
2. Stop print production, but keep the authors and editors around producing travel guides in digital
form. Alas, this would only exacerbate the losses, as e-book and app sales make up only a small
11. fraction of printed book sales and the actual printing is only a fraction of the cost of book production.
This option seems thus very unlikely, and my money is thus on:
3. Stop producing guidebooks in any shape or form, dispense with narrative content entirely and
focus purely on points of interest. (This is what Zagat has always done.) It also means throwing
any direct revenue model out the window, although it does keep their B2B arm Frommer’s
Unlimited afloat. It will be interesting to see how much money Google is willing to sink into paying
authors and editors to update those reviews, but it’s quite conceivable that the answer is ―none‖, in
which case we end up at the final option:
4. Fire all editorial staff and let the content decay. If the purchase is indeed purely a tactical ploy to
temporarily beef up their reviews while they wait for Google+ to reach critical mass and start to
create fresh, user-generated content à la Zagat, this actually makes perfect sense. Google
doesn’t even need authors for the other half of their usual job, verifying practicalities details
(addresses, telephones, etc), as Google has already mastered that process through other means.
If Google goes with the 3rd or 4th option, and I have hard time seeing them not do so, their second
problem (or, rather, missed opportunity) will be the lack of content curation. By treating guidebooks as
no more than a database in print form, turning them into a homogenous soup of atomic points of interest,
Google is effectively conceding to compete on a level playing field withlocal search rivals like Facebook
and Foursquare. All three now assume that users are searching for individual points, easily filtered on
individual axes: ―best five-star hotel in New York by user ratings‖, ―cheap Japanese restaurant in
Melbourne CBD open for lunch‖ etc.
But a guidebook is not the same as a phone book: it’s supposed to contain a careful selection of the best
places to go, arranged in a sensible way. Neither Facebook nor Foursquare can offer a sensible answer
to real travel questions like ―Funkiest bars in Brussels‖, ―Romantic day in Paris‖, ―Three-day hike in New
Zealand‖, whereas any guidebook about those places that is worth its salt can. As an
engineering-driven company, Google has given things like this little thought simply because they are hard
problems for artificial intelligence to solve — but using Frommer’s team of authors, it would be possible to
augment the automated results produced by things like theKnowledge Graph to field hand-curated
content as well.
If Google goes ahead and does this, then the Guidebook of the Future will be that much closer to reality
and travel publishers will have a real problem on their hands. But I doubt it, and that’s why those
publishers are breathing a sigh of temporary relief: one competitor less means a bigger slice of the
shrinking pie for the rest.
http://skift.com/tag/frommers/
2012.08.17