My Vision of where the web is going.

I’ve wanted to write a post like this for a while.  Here is my view of what is happening on the web today and what is driving innovation.

Phase 1.    The first great change on the web that created a real big enconomy was when Ebay came along.    To cut a long story short,  Ebay now allows 750,000 people to make their living off of ebay each year.  These people aren’t employees of ebay but they are using ebay as a platform to generate a living.

Phase 2.   Affiliate programs.  thousands of people have made millions off of affiliate programs,  started by amazon and perfected by many other companies hundreds of thousands of people are recieving payments each month for promoting various products and services.  There have been many many millionaires created in this space and a lot of companies.

Phase 3   Google Adwords.   Before google adwords affiliate marketing was just something that people with websites could do.  With the advent of adwords and its massive traffic now suddenly everyone could mass buy traffic and resell it for a higher price.  Overnight another industry was created employing tens of thousands of people who make a living off arbitrage.

Phase 4  Google Adsense.   This was the real game changer, before people could only monitize content via affiliate links.  The problem there is that if you had repeat traffic you wouldn’t make much.  If you had traffic from countries other then what the merchant would cater to you were out of luck.  Google provided a steady stream of constantly changing advertisers for your users.  This allowed you to monitize them somewhat effectively for the first time.

The first several stages were all about empowering people to make money using someone elses platform.   Once google adsense came along you could for the first time make money off your own platform.  People could build hobby sites or anything else they desired and monitize it to some extent.  Now several years after adsense’s launch we have several hundred thousand people making money off adsense and slowly building up digital empires.

Ebay Created a economy of 750,000 people making a living off its site.  Google created a program where  a couple of hundred thousand people could monetize their sites.  Now thanks to google, huge drops in hardware costs and better software  individuals and small companies can build sites that were impossible only a few years ago.  At the moment there is no better example then me,  if you would have said 3 years ago that someone was doing 600 million pageviews a month out of their apartment with no employees you would have been laughed at.  There are thousands of other people who in the past 3 years have used adsense to grow and build large sites.  In the next 2 or 3 years we are going to see thousands of these sites run by little groups taking over industries.   This is because they will have reached critical mass.   Even if only 1 in a thousand is successful  that will still hurt established players in a big way.

So what will happen to the “build anything with ajax and get funding right now” mentality?

I think that VC’s will start to wake up and realize that Ajax is a feature and not a product,  at the same time  how are 100-1000 or so VC funded companies going to compete with a couple of hundred thousand webmasters who have created sites wanting a piece of the action?  Many of these webmasters would be perfectly happy with $100/month.   But if even if 1 in  a 1000 of those adsense driven sites is very successful your entire industry could be screwed.  Just look at online dating.

37 Responses to “My Vision of where the web is going.”

  1. Arash Says:

    well, yes i agree. It is about traffic and in future it would be even more so. when google rolls out a full-fledged behavioural targeting, sites like yours would not only show ‘dating’ ads but also anything else that is relevant to each user and their ‘temporal’ intrests.

    PS: 600 mil is sweet!

  2. Big Daddy J Says:

    All this VC funding has me bracing for the next big bubble burst. Now is the time to diversify, especially if you are only using adsense and on one site. Expand or die in the near future.

  3. Dave Dugdale Says:

    Good post. Keep them coming.

  4. Andy Arnott Says:

    When you think about it, when this next boom fizzles who will be left? The million dollar VC funded bloatware sites, or the self funded, one man (or women) shows? Easy answer!

    We are the champions my friends…

  5. Yanook Says:

    true

  6. Paul Says:

    What I’m seeing with all this web 2.0 spending frenzy, is huge companies recognizing that giving people a platform to a) find stuff b) make money c) express themselves d) mingle with each other – is powerful. They just have to figure out how to monetize it properly so there’s a long term return on their investment.

    As Marcus has expressed many times here on his blog – keeping the cost of those platforms low is a key point to their success. Some will ‘get it’ and some won’t, but it’s the small guys with low overhead who stand to profit the most. The big companies need to be watching them rather than buying them.

  7. G Says:

    How about msdewey.com growing to 600M pg/mo in just 2 weeks? Essentially they are using the model of network television: use beautiful people to attract an audience.

  8. Zoltan Says:

    Diversify. This is the most important “keyword” on the business. Don’t just build a website for AdSense, build a website for your users and diversify your sources of income.

  9. Mayo Says:

    What Zoltan said:
    DIVERSIFY !!!

    I will make money(hopefully :) ) from AdSense, but primally from my own advertising system – a pain in the ass to build but it will give me more freedom and more gain to make money == more pure profit!

    And for AJAX, it’s just a feature, but as you said to stay under radar – you can whery easely stay under radar with it, it doesn’t matter if Alexa or other stat system won’t count it – Google AdSense will! You have scritp that will count “supposed” pageview, it’s true it needs some tweaking to get true stats – but i can burry your site Markus without you even seeing it!!
    Why? Becouse of AJAX – only Google and my direct advertisers can see how much of traffic i make… So all of you out there not using AJAX … be scared, be whery scarred …. buahaha …. LOL

  10. Dave Evans Says:

    Your crystal ball moment is Ajax and Adsense and little groups taking over industries? Dig a little deeper, how about interrelated ecosystems, web services and community content? That’s where it’s at, not javascript and advertising.

  11. Mayo Says:

    Dave is this revolved to me or to Markus??

    If it’s revolved to me, then i say Ajax is just a tool, a complicated but great tool…
    Advertising is where the money is!!!
    And money is where are group of people satisfied with you product!!!

    Momentum == More people == more momentum == more money == more momentum (Markus big fat check that made the NEWS) == more people == more money ………. ;)

    But don’t listen to me, i’m just another WANNA-MAKER ;)

  12. axewielderx Says:

    Hmmm, and I thought the internet was about more than just making money.Stupid me.

  13. Mayo Says:

    Axe,
    Is it really not more than just making money…??
    Than why do you or your parents work?? Only don’t tell me that you have free internet connection :).
    Internet was made to make money more easy, to connect scientists to transfer ideas so — their ideas can more quickly see the market (i.e. military market, NASA projects, patents, …. )

    Also why is eBay so big?? Money, you can make a living with them, why is AdSense big?? Money (they transfer it to almost every Joe Dirt with a blog), oh and love ?? — sure you seek love for LOVE IT SELF, but why do you marry ? Well you marry to have someone to help you i.e. ECONOMIZE, i.e. spend less time on daily house chores i.e. money==time i.e. more money (a little streched, but basically that’s it!)

  14. Mayo Says:

    Oh and MySpace was specially cloned to make money! Nothing else than to sell advertising, they saw Friendster succsess and cloned it… Rest is history …

    Oh, and myspace was not made by two guy’s in the basement, but by the Spamming corporation, who was making money mostly on spyware and et. al.

    If money is not the issue, then how do you think Axe internet got so BIG? Becouse corporations love to see people having fun and those same corporations didn’t want to use those poor little people to make money on them… grow up!

    This whole world is all about $, Euro, Yen, ….. Sad but true :(

    See only Markus, if he didn’t wave that big fat check in our faces, who do you think would give him a damn?? Now he’s a quasy-celebrity :)

  15. Zoltan Says:

    Mayo is right… the whole world is about money. But what if you already have enough money?
    I talked today with a friend who owns a 200,000 EURO vila and now he builds another one, bigger, better etc. He invest in this new one 400,000 EURO. He said, he don’t know what to do with the old one… Sell it? If sold, what can he do with the 200,000 EURO? He alread has everything he need: family, car(s), business, been all over the world…
    Funny…

  16. Mayo Says:

    Well, it depends what you want to do….

    Do you want to have 10MM Euro villa, a hotel, a private city (sheiks Dubai artificial island), do you want next GeneralElectrics, Microsoft, Google … OR just have a little house, pecefull life, boring death…

    I would choose and will choose the MIDDLE, small house with lots of space , wife and 2-3 kids, and booming businessess (got already dozen ideas, and working on first one… ;) ), AND lots of privacy (2-3 miles to the closes neighbour) ;)

    Oh, BTW my family has house worth 600,000 Euro and doesn’t know what to do with it, family is in ruin and so is the house :(. I tried to reconcile my mother and her brothers and sisters but in vaine :(, they want more on basis of nothing (except my mom, they want MM’s on basis of nothing, they don’t want to invest, they don’t want to commit, all they want is cash on the hands and high life, now it’s going to ruins and i won’t invest nor time nor money till it goes bust , not even then :( )That is maby one of the reasons why i like Markus want to be my own boss.

    Major thing is to evolve your business, make it bigger, Markus you make lots of money, but you could make even more… you have idea about direct selling of flowers (you mentioned it in previous post) – you have CASH, invest, controll and EXPAND! Try to make more, but do it one step at the time… we have lots to learn from you… :)

    my 2 c’s

    Mayo

  17. Mayo Says:

    One other thing is when you’r rich you can help others who are not so lucky as you!

    All those little kids that were abanoned by parents, or if they lost parents by their grandparents, friends of their parents…. you can help them while they are still little and can aquire all the good qualities of human being (to love, to give, to work, to teach) …. well you must act quickly before they are lost .

    Also give money for the research of cancer, genetic disease…

  18. Marc Says:

    To the guys lamenting about the world is run on money. Money is the single largest invention in the history of mankind which dramatically reduced, war, pillage, plunder, theft. Yes we still have those, but without money, things would be much worse.

  19. Mayo Says:

    This blog is a shrime for moneymaking – it is not some B.S. guy who is trying to sell you “make million bucks in a month” B.S. – the words written from Markus are mostly ;) full of wisdom becouse he actually made it and is discussing and giving education for free !!- this blog is dedicated to: TECH and ADVERTISING==MONEY as i can see, or am i miopic??

  20. Mayo Says:

    Axe,

    The good book is known by the first page :)

  21. Mayo Says:

    Google is not spending a “dime” ;) on advertising:

    http://blogs.zdnet.com/micro-markets/?p=600

  22. Martin Says:

    Started by Amazon? lol, Only one group to thank for affiliate marketing and perfecting it to where it is today. Porn!

  23. Markus Says:

    Amazon has a patent on affiliate marketing.

  24. Dankind Says:

    I was under the impression porn came out with affiliate marketing as well. Wikipedia cites ( http://en.wikipedia.org/wiki/Affiliate_marketing#A_Brief_History_of_Affiliate_Marketing ) cdnow as the first ones to do it…

    I would think the online porn industry has more than just a little to do with the current state of internet advertising, and probably webcam technology too =) They’re constantly up against legislation, filters, etc. that they need to work around to get to their audience and earn profits and they do. Even if they’re not the first to come out with the ideas, you can make a pretty good bet that they’ll milk the hell out of anything that they find that works.

  25. BSG Says:

    Wonderful article! This is definately the site ive been looking for for awhile. Someone linked it in a post on sitepoint, glad I found it. Please keep the words of wisdom coming.

  26. Robert Ryan Says:

    I have been on net three years. Interested in copyright and content. What is written here does not sink in. I was/am veritable “clock culture” and can not follow the power structure spoken in this blog. Also I cannot believe the site is active for posting at this late stage of date. If you are reading this and it does not rate a spot in the obvious gaping time gap, with the content that has not been posted as well, is my reply good for,?
    I feel as though I am groping in the dark in trying to catch up to the gap in my own comprehension of this “new world of optimal marketing worth>” I have venues not seen in my research/networking and a stalemate in many great ideas because context and symmantics duck my grab! RR

  27. kool0022 Says:

    Do you think Affiliate Marketing, from the perspective of putting product aff link on our sites is still a profitable business.

    I mean I prefer adsense where I get paid when someone click. I don’t care if they buy or not.

  28. Haidi is expertised in make money now Says:

    i would prefer adsense as my first income rather than affilliate program

  29. matthew faulkner Says:

    Your information is very good. I think having only been in internet marketing full time for about a year, that a newccomer could make ther first dollar the easiet with adsense.

    thank again / matthew faulkner

  30. Tom Lee Says:

    Can somebody advice of some Affiliate Marketing programs that pays more than Absence is doing at the moment?

  31. mark Says:

    a good site to make cash is http://www.coinpart.com

  32. rnr_hoochiecoo Says:

    I have made some decent money using my main blog with Google AdSense. But here is a great method I have been using to make money online.

    I purchased a digital product from the ClickBank marketplace and reviewed the product. Once I did this, I followed what I read to see if I would get the same results the writer did.

    I did a short video teaching others what I learned and then made a recommendation to purchase the product at the end of the video. Of course, I only created a video for the products that actually worked for me. Since these products did work for me, by watching and following the video, you will also benefit by seeing a dramatic increase in conversions.

    Then I recommended this product through my own affiliate link. This way I could earn commissions on what others sold. The best way I found to do this was to purchase a meaningful and memorable domain name and redirect the domain to my affiliate link. Then overlay that link in the video.

    I usually post my videos on my blogs and send it to my mailing lists to make money. But if you don’t have a list, then upload it to YouTube and several other video sharing sites to make you commissions.
    It’s a great technique that’s worked for me.
    Cheers,

    Timothy M. Theis

    http://googlecash-pump.com

  33. Culbert Says:

    A very fascinating article, frankly I know a lot extra information from this article

  34. mike1144 Says:

    i think affiliate marketing is the best way of making money faster. and eBay is serving very good.
    readers can know something informative on searching “dynamixgate wordpress bay” on google search.
    nice post:)

  35. News Says:

    [...] offer, mentioning that ‘VC…isn’t a good fit for niche publishing’ over on plentyoffish Mark Frind notes ‘how are 100-1000 or so VC funded companies going to compete with a couple [...]

  36. http://2richmoms.com Says:

    Well said!

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