But that doesn't mean that Google couldn't have built a decent virtual world if it wanted to. If Google wasn't under the gun by a tanking economy, and if they had real incentive to build a virtual world, here's how they could have made Lively more successful:

1. Hold up the launch of Windows- and Internet Explorer-only Lively until it runs on Firefox and the Mac. A disproportionate number of the early-adopter community uses the Mac and/or the Firefox web browser. If you throw a Hail Mary like "everyone get avatars and move into 3D chat," you need the Firefox and Mac users on board right away. (This goes for Google Chrome too, the company should port it to the Mac ASAP.)
2. Scrub the virtual world completely free of sex and violence. In Lively, you could use the "crush" command to make an anvil fall out of the sky and wallop another user's avatar, or use "kick" to hit someone in the groin. It was funny. Actually, it was so funny all anyone did in Lively was try "punch" or "choke" anyone in range. And some of Lively's avatar designs -- especially the anthropomorphic animals -- were creepy enough, even without random furries always trying to beat you up or romance you.
3. Showcase what can be done with the technology. Here Google made the same mistake with Lively that Linden Lab made with Second Life -- it put its virtual world technology out into the public domain and thought its mission ended there. It doesn't. Google should have hosted its own Lively rooms and held events in them, encouraging new users to try out the service. Lively rooms would have been a great tie-in with other Google services like Orkut or Google Groups -- but Google was content to let Lively flounder alone at lively.com.
4. Make Lively an extension of Google's advertising platform. It would have been relatively easy for Google to program Lively to include advertisements piped in from elsewhere on the web, so a virtual room contains a space a few hundred pixels square that rotates through an ad in Google's inventory. The company could then split revenue with any website that hosts and gets traffic to an ad-enabled Lively room -- just like it does with flat web pages via AdSense. There's probably only pennies involved, especially in this ad climate. And good luck finding advertisers who prefer avatars to real customers. But Lively could have been much more likely to propagate if people had financial incentive to use it.

Of course, Google did none of these things. The point: Watchers of the fledgling virtual worlds industry -- which raised almost half a billion dollars in investment just in the first three quarters of this year -- shouldn't read Google's departure from the game as a negative verdict on the virtual worlds idea as a whole. Google didn't even really try.

See Also:
That Was Quick: Google Kills Virtual World 'Lively'
Google's Lively Is Just Like Second Life -- No One's There But Perverts And Griefers
Google: No Sex in Second Life-Killer Lively

Adconion, an online ad network, has acquired RedLever, a Santa Monica, Calif. based content distribution network. Financial terms of the deal were not disclosed. Adconion has raised $80 million in their third round of funding earlier this year from Index Ventures and Wellington Partners, some of which are now put to use. As part of Adconion, RedLever will develop and distribute branded video entertainment created specifically for agencies and advertisers across the Adconion.TV network which launched last month.

“As more dollars shift online and are drawn to high quality content we are forging ahead to evolve the ad network model into a next generation television network,” said Tyler Moebius, Founder and CEO, Adconion.

Press Release

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Time Inc is slashing hundreds of jobs (600 hundred to be precise), but due to reasons known only to them they are doing it in small numbers each day. Reuters has now confirmed that the Cottage Living Magazine staff is laid off and in doing so around 38 jobs have been lost. The remaining 11 workers would be adjusted some place else.

Meanwhile Peter Kafka has got the memo sent out to Time staffers about what would commence at Cottage Living:

November 18, 2008

To:         Time Inc. Employees

From:     Sylvia Auton

Re:         Cottage Living Magazine

I regret to inform you that we will no longer be producing Cottage Living magazine. The November/December 2008 issue, on newsstands now, will be the magazine’s last. Cottageliving.com will also shutdown. However, the company will keep the brand alive in one of its other leading shelter titles and these plans will be finalized over the next few weeks.

Since its inception, Cottage Living attracted significant advertiser support and fostered a loyal following among readers. However, the economic downturn has particularly affected the shelter market and while the brand was genuinely loved by readers and advertisers alike, the economy inhibited its ability to grow and therefore, sadly, we had to make the decision to close it.

Cottage Living launched with a unique editorial mission. Its readership celebrated community and character over conformity, personality rather than perfection, and informality instead of pretension.  The brand’s tagline: “life just right,” showed how one could ‘live large,’ even luxuriously, in a lighter footprint.

Launched in September 2004 with a circulation of 500,000, the brand quickly grew to 650,000 in January/February 2005.  One year later, Cottage Living increased its rate base to 900,000, and then to one million in January/February 2007.  Cottage Living also produced many one-time special interest publications including Cottage Christmas and Cottage Makeovers.

Cottage Living also received many industry accolades including AdWeek’s “2005 Startup of the Year” and Advertising Age’s “2005 Launch Worth Watching.” It was also named to AdWeek’s “Hot List” 10 Under 50 list for two consecutive years: 2006 and 2007.

I want to thank the many dedicated and talented Cottage Living staffers. It was developed, edited and published by some of the best talent in the business and we can remain proud of its many achievements.

S.A.

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Apptera, a company that delivers visual and voice advertising, announced on Wednesday that it has secured $10.5 million in funding from Lightspeed Venture Partners, Alloy Ventures, and Walden International. The company also announced that former Yahoo senior executive David Karnstedt joined its board of directors.

According to the company, the new investment will be used to expand its mobile-advertising network and improve its MobileAd Xchange program, which allows advertisers to reach mobile-phone users.

Apptera has partnered with AT&T, AOL, and other technology platforms to deliver its ads, and it claims that it currently serves millions of advertisements each month. Most of those ads come in the form of commercials heard through free 411 services and AOL's Moviefone.

Funding and ad placement aside, Apptera still has one major issue to overcome: competition. Google and Microsoft have made it abundantly clear that mobile advertising is the next frontier, and both companies are exploring ways to corner the market. And although that probably won't happen for a few years, Apptera needs to ensure that it's ready when major companies enter the market.

Writes BoomTown's Kara Swisher: "Obviously, the dream CEO for Yahoo is News Corp. President and COO Peter Chernin. Chernin has the right resume: Experienced at running large and complex organizations; savvier than most in media about the Internet; able to make the kinds of dramatic decisions needed; and, perhaps best of all, signaling-via the Los Angeles Times-just this past week that he was open to leaving the powerful media and entertainment conglomerate for something new.

Writes Bits's Saul Hansell: "Yahoo doesn't need a chief executive so much as an editor in chief. And I mean the sort of imperial editor who has a vision of how to create an environment that lures in both readers and advertisers, like Tina Brown, Clay Felker or Adam Moss."

Writes PaidContent's Rafat Ali: "Whether it wants a Silicon Valley-engineering-culture-steeped executive; or a media-business-New York-centric executive who will be the ad-industry bridge; or for that matter, an entertainment executive from LA, who would help build Yahoo's brand reach and bring in the big bucks (Terry Semel experience will make it wary, though). That decision would help define the future of Yahoo, and whether it survives as an independent company"

Writes GigaOm's Om Malik: "Hopefully they will bring on a no-nonsense, [HP CEO] Mark Hurd-style executive who can stabilize and revive the company by making it leaner, simpler and have it focus on its core competencies. For PE investors, there is also comfort in the fact that Yahoo can at anytime sell its Asian holdings for a ton of cash. They might be able to find some takers for their European properties as well."

Writes Valleywag's Owen Thomas: "[Frontier CEO Maggie Wilderotter] has several pluses: She's actually been a Silicon Valley CEO, unlike Yang, previous to his current run in the position, and Decker, who's long aspired to a top job somewhere, but now looks farther than ever from getting it. With media, advertising, computing, and telecommunications merging into a single business, it strikes me that most of Yahoo's board and management are ill-equipped for the transition. Not Wilderotter, who's worked for Microsoft and AT&T and run Wink Communications, an interactive-TV company which she took from startup to IPO, through boom and bust."

Writes CNET's Stephen Shankland: "Analysts also believe it's better to hire a new CEO whose experience tilts more toward the advertising and media realm than the technology realm. Yahoo still has a powerfully large audience, and it's not going to outdo Google when it comes to letting the robots rule the roost."

Writes the Daily Beast's Eric Jackson, picking Microsoft CEO Steve Ballmer: "The best outcome for Yahoo! shareholders of course would be if the new search committee never selected a CEO. This company should use this change in leadership to go back and open discussions with Microsoft about selling the company. This made sense when Microsoft made its initial offer last January at $31 and it makes sense (triply so) now."

Writes TechCrunch's Michael Arrington: "Who will be the next CEO? We speculated back in June that Jeff Mallet or Dan Rosensweig were possible candidates. Mallet wouldn't consider the job, we've heard. But Rosensweig would probably take it if offered. Whoever ends up with the job, let's just hope it's an outsider. Yahoo is being clear that they are considering internal candidates. President Sue Decker is likely being considered. But ex-execs we've spoken with say she was a big part of the problem at Yahoo, and if she takes over as CEO it will likely be more of the same."

See Also:
Choose Yahoo's New CEO: Round 2 (Vote Here!)

We wanted to give you the heads-up, as you may soon see small clickable advertising banners in the fring chat window, beneath the chat itself. Clicking the ad will open your browser and take you to the advertiser’s site; you may even find extra special offers, cool promos & other nice surprises behind the click from time to time And, more clicks mean happy advertisers; and happy advertisers mean more resources for us to develop cool new stuff for you to play with in fring!

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VideoEgg has decided to get those flash ads into the iPhone apps. The rich media and video ad network put out AdFramesSm for mobile that enables advertisers to distribute their ads, expendable videos etc to the large population of iPhone users. Troy Young, CMO VideoEgg, stated in the press release:

The key to creating value for advertisers is offering an invitation-based ad solution that engages consumers and rewards them for spending time with a brand. By applying our deep understanding of video and rich media advertising and extending our AdFrames platform to mobile devices, we’re opening up a new channel to reach consumers with a proven opt-in approach. Advertisers get innovation without risk.

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At launch, many of the applications come from familiar names: Meebo, PollDaddy, Sphere, and ShareThis, just to name a few. App developers can offer their products under one of several monetization models according to Glam: “ad-enabled with required IAB-standard ad units, sponsored or advertorial widgets, paid for or subscription based applications and free no-ads utilities.”

To get the applications, publishers can browse the categorized app gallery on the Glam Apps site. Once they’ve been added to their sites, they can begin to earn a revenue share on them, with Glam handling the ad sales – as they currently do for traditional online ad campaigns. During the private beta, advertisers on the Glam Apps platform included T-Mobile, Levi’s, and V05.

If this sounds familiar, you’ve clearly been paying attention to the dozens of other platforms that have launched over the past year. Actually, Glam Apps seems most like one of the big widget platforms like Clearspring or Widgetbox, except it’s for-use by a single, highly-targeted content network, with an ad sales team focused on selling to that demographic. It’s a good idea, but perhaps a little late to the game – with growth in online advertising slowing, there has to be some concern about how many platforms and ad networks the market can support.

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In the past, though, tons of bloggers have taken potshots at YouTube for not realizing the potential of the $1.65 billion investment by Google. One of the more recent times I got on this particular merry-go-round was back in June in response to Mark Cuban, who said that Hulu was in danger of roundly kicking YouTube’s ass in terms of viewership and monetization. Back then, as they do now, the traffic numbers simply tell a different story.

As you can see, back in June through October of this month, Hulu has seen significant gains relative to their current traffic patterns (very likely due to the highly watched election videos and Sarah Palin - watch for this line to drop in December). Compared to YouTube? The difference is still monstrous.

How is it possible, then, that the Financial Times is able to make statements like this:

Neither company breaks out its advertising revenues but Arash Amel, analyst at Screen Digest, forecasts that in 2008 YouTube will generate about $100m in the US, compared with about $70m at Hulu. Next year both sites will generate about $180m in the US, he says. YouTube currently earns around half of its revenues in the US, while Hulu has not yet launched internationally.

Setting aside any quibbles we may have with their estimates, for a moment, very simply put - the Hulu sales team is lightyears ahead of what’s being done at Google.

Aren’t Advertisers Just Scared of YouTube?

That’s the phrase that pays when pundits and analysts come together to talk about monetization efforts on UGC video. Frederic mentioned it in his writeup. Henry Blodgett said something similar when he deigned to advise Google to “throw in the towel” on YouTube. The issue doesn’t have anything to do with advertiser readiness to throw down with the money, and more to do with the limited avenues to do so.

Just as a proof-of-concept on this theory, give yourself a five minute limit to figure out how to put an ad on the side-bar on a Google search result.  Even if you don’t know where to start, you should get there with four minutes to spare, assuming you know how to … you know … type a Google query.

Now try the same thing with YouTube.

Not so easy, is it?  If you’re lucky, on your third or fourth search query, you’ll turn up this page, which YouTube dubs its online media kit. If you have the patience, you can spend about a half-hour watching Googlers tell you how awesome it is to advertise on YouTube, complete with some product manager playing with his plastic dinosaurs.

This is what I’m talking about.  If you actually watch these videos, you get the picture that YouTube is running advertisements on only a fraction of those gazillions of page-views and video views. In fact, they only run ads on videos that participate in the “Partner Program,” a program not easy to figure out how to join, either.

Just think of the money YouTube could make if they ran just a stupid little text-based AdSense unit on every page on YouTube. We started running through this intellectual exercise the last time this topic came up here - we determined that YouTube needed to monetize (generously) 1% of their traffic to thoroughly trounce Hulu.

It’s easy to see here that the same minds that brought us search ads aren’t working on what’s at YouTube, otherwise they’d have this problem licked by now. For further proof, take a gander at your AdWords account, and try to find the button that allows you to advertise on YouTube.  I’ll save you some time - it isn’t there, not even next to the “advertise on radio” or “advertise on TV” links.

Hulu Doesn’t Have an Easy Advertiser Form Either. How Are They Doing So Well?

That’s because they don’t need one. As Blodget notes in his write-up, Hulu gives more money back to its partners than YouTube does with theirs.  What Blodget fails to mention is that this is a pointless statistic, since Hulu is essentially a puppet entity for News Corporation and NBC Universal.

This means that they don’t really need to rely on an in-house sales team as YouTube does, at least not throughout the year. They do the bulk of their big name, high dollar selling at what’s called the “upfronts” every year. Millions of dollars trade hands after the May sweeps at these star-studded events, and YouTube hasn’t made inroads to tap into this market.

If they sold at the upfronts, it isn’t like it would land them the type of money Hulu’s getting.  Even the most watched content on YouTube still doesn’t have the international brand recognition of your average show on the WB. Simply put, the TV networks still have decades of brand recognition built up, and YouTube is technically still a toddler.

As Soon as Google and YouTube Start Playing to Their Strengths…

Here’s the point I’m driving at - YouTube has been doing things right in almost every category so far when it comes to growing the brand and traffic to the site.

They have a lumbering behemoth in terms of traffic, and it looks to me like they’re trying to outlast some dinosaurs of Old Media just long enough so that some of these pesky copyright issues outmode themselves (either by these Old Media companies dying off themselves, or their grasp of New Media catching up with reality). That’s frankly the only explanation I can think of behind why they’d not treat their YouTube traffic like every other type of traffic contained within the Google family.

Playing to their weaknesses, and by that I mean trying to compete with Hulu and other studio produced aggregators head on… it’s akin to looking for the golden needles in the haystack, instead of feeding all that hay into the gold-spinning wheel they have sitting in the back.

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