Google's risky advertising business

Michael Arrington continues to be quite displeased with the PayPerPost business model."How much is your soul worth" he asks, in TechCrunch's second "Soulless" PayPerPost story.

Michael Arrington continues to be quite displeased with the PayPerPost business model.

"How much is your soul worth" he asks, in TechCrunch's second "Soulless" PayPerPost story.

BUT, are media souls really in danger of being compromised merely because of one new advertorial entrant into the publishing market?

How about "old school" advertising supported media plays, or Google's new fangled advertising/PR cum content AdWords product?

TechCrunch has reassuringly undescored that IT "does not accept payment for posts."

WHEW! Nevertheless, Arrington has acknowledged even he may be susceptible to wine, flowers or TEARS!

In his latest tour de force feigned outrage post just last week, "Silicon Valley could use a downturn right about now," Arrington indicated he has a hard time maintaining the editorial fortitude necessary to withstand the pressure of CEO and PR pleas to "report" company messages: 

Entrepreneurs are no longer talking to us just to get our opinion and hope for a blog post and a little discussion. These guys need press to stand out from the scores of startups just like them. Saying no to them isn’t really an option. They show up at our front door with a bottle of wine or flowers. They instruct their PR firms to do anything necessary to get a story. More than once I’ve had a CEO break down and cry on the phone when we said we weren’t covering them. And more than once, I folded and wrote about them after those conversations.

In originally covering PayPerPost, TechCrunch lamented damage the "bad boy of blogging" may do to the "reputation" of the blogosphere:

Is this a bad joke designed to torpedo the blogosphere’s credibility in general? It doesn’t appear to be. If we’re all trying to negotiate a space between Hollywood and mainstream journalism, this is taking things way too far towards the most insipid parts of Hollywood.

Marshall Kirkpatrick's vaunted concerns for the "credibility" of the blogosphere could actually be extended to questionning the integrity of mainstream journalism itself, and Google.

MAINSTREAM JOURNALISM "HOW IT WORKS?"

Wall Street Journal's "Peanut Butter Manifesto scoop," circa November 2006, as assessed by veteran mainstream journalist, and Columbia School of Journalism graduate, Larry Dignan

The Wall Street Journal publishes a Yahoo memo penned by Brad Garlinghouse and it took bloggers about an hour to start pondering conspiracy theories. Among the questions summed up and raised by Donna Bogatin and a few hundred other bloggers:

How did the Journal get the memo?, Did Yahoo give it to them?, What were the motives behind the story and the memo?

Puhleeze. All of those questions are irrelevant and naive.

REALLY? Apparently, to old school mainstream media journalism, in any event. Dignan on "how it works," the "fair trade" quid pro quo notion of standard journalism operating procedure that is:

The Journal got the memo because it's the business paper of record. It's called reporting and brand credibility that has taken decades to build. If you're a CEO–or any exec–looking to float a memo you are going to the Journal. It's your first stop to reach the folks that control your market cap.

Journalists are used to float trial balloons all the time. Say you want to acquire an wacky startup like YouTube. What do you do? You go to the Journal with a story noting "talks are in the early stages and may unravel." Then you watch Wall Street's reaction. If the stock is flat to up a bit on the "news" you do the deal. If the stock falls 30 percent perhaps that acquisition isn't a good idea. This is standard practice. For instance, Microsoft internal memos don't get leaked. They get spoon-fed to key reporters with clout.

Every story you read has a motive. Yahoo's motive: Look like you are doing something–anything. Say you're Yahoo CEO Terry Semel and the peanut gallery is calling for your ouster. In Semel's position you can't look passive so maybe Yahoo determined it made sense to "leak" the memo to the Journal. Now before you run off yelling "Conspiracy!" this is called reporting. Yahoo wanted to see what would happen if it floated the idea of laying off a bunch of people. The Journal gets a good story and millions of in-bound links. That swap is a fair trade and standard operating procedure.

Maybe standard operating old media operating procedure, but not in the spirit of The Society of Professional Journalists' (optional) Code of Ethics, as I reported in WSJ and Yahoo’s peanut butter: Conspiracy? NO Ethical? NOT SO last November:

Identify sources whenever feasible. The public is entitled to as much information as possible on sources' reliability.

Always question sources’ motives before promising anonymity. Clarify conditions attached to any promise made in exchange for information.

HOW ABOUT NEW MEDIA? Google

The Internet King is flexing its own advertising/PR cum editorial muscle, right in the heart of the blogosphere, as I have been reporting and and analyzing in:

Will Google corner the ‘paid link’ market, too? and Google blurs line between advertising and content, again and Is Google doing advertising evil with new model?

A new "Paid" but not quite identified as "Sponsored" Links Google advertising product, Pay-Per-Action (PPA) text link format, encourages the "blending" of paid for ecommerce transactional links into publisher editorial, but does not require any upfront "advertorial" disclaimers by AdSense publishers for the Google ad product being shown to consumers "blended" with "objective," non-paid for content.

What is the text link format for pay-per-action ads? Google asks, and answers:

Text links are hyperlinked brief text descriptions that take on the characteristics of a publisher's page. Publishers can place them in line with other text to better blend the ad and promote your product.

For example, you might see the following text link embedded in a publisher's recommendatory text:

"Widgets are fun! I encourage all my friends to Buy a high-quality widget today." (Mousing over the link will display "Ads by Google" to identify these as pay-per-action ads).

Shorter links perform better because they allow the publisher use the link in more places on her/his site and in different context

Google is “excited” about its new PPA “pricing model.”

How excited will consumers be, however, if they are unwittingly mislead by the inherent ambiguities of the new Google advertising and ecommerce engine, to be distributed via the ubiquitous Google AdSense network?

A "disclaimer" upon mouseover is not in the spririt of Google.com's "Sponsored Links" stringent policy. 

What's more, how excited will bloggers fueled by Google AdSense be when they enthusiastically "blend" Google AdWords "paid links" into their editorial?

ALSO: Why Facebook is scarier than Google and Will Google meet GPS on the golf course?