November 29, 1999 -- Newsletter #56

By Joe Burns

November 29, 1999 -- Newsletter #56
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Greetings, Weekend Silicon Warriors,

I'm writing this newsletter on Black Friday, the day retailers traditionally go "into the black". This morning I heard that the average US shopper buys 25 Christmas presents for 10 different people from nine stores. I don't know that I'll buy 25, but I do know that I won't visit one store. This year, I'm an online guy. CBS is predicting that over 23 million people will do just what I'm doing.

I also think this year I'm going to buy my wife a millennium gift. Yes, I know it's a retailer-created gimmick, but who cares? Tis' better to give than to receive.

Did you hear...

According to ZDNet, during the month of October, the Web attained one billion hits per day. Gosh!

Chenming Hu, a professor electrical engineering and computer sciences at the University of California, Berkeley has apparently set a new world record. He's created a new form of transistor semiconductor that will, supposedly, hold 400 times the data of previous chips. If it's the case, look for future CPU's to make the current 500Mhz versions look like snails in molasses.

It seems I can't get through two newsletters without warning of a new virus. Well, here's another one for you. Prilissa is a new Trojan Horse virus that works somewhat like Melissa, but will lie dormant until Christmas when it explodes and does damage. Go to your virus protection software home page and get the latest updates to check your machine.

Didn't your mother tell you that e-mail wasn't secure?!?! If not, here's more proof. Former emphasis on former Internet Service provider and online bookseller Interloc Inc, has been told to pay a quarter million US in fines after being found guilty of intercepting e-mails and recording user's passwords. That's scary, huh?

Now onto today's topic...

It was a few years ago, but I remember taking what amounted to a basic business class. The professor was great in that she taught by asking questions and then directed the student's answers down the correct path. She asked:

"Would you pay a dollar for a Snickers candy bar?"

The immediate answer was "no" because Snickers candy bars were only 50 cents. Then she added:

"What if someone brought it to you?"

A couple of us kept our "no" answer, but many changed their mind. It was worth 50 cents to not deal with the hassle of getting up and buying a candy bar, when for only double the price someone would bring it to you.

She then asked:

"Would you like to hear a commercial every time you make a phone call?"

Again, the rousing chorus of "no".

"What if the cost of the call, thus your bill, was cut in half if only you listened to a five second ad when you made the call?"

Uhhhhh...yeah. OK.

Now we return to present day. I was going through my e-mail this morning and there it was. Each 200 new e-mails contains at least one request for me to package up the Goodies site and make it available for download so the pages could be read off line. I always answer no because that would mean only one visit to the site to download the items. That would mean only one viewing of my banner ads. That would mean a severe drop in banner ad views, advertisers drop out, no money coming in to pay for servers, Goodies becomes a pay-for site.

Would you rather see no banner ads and pay for HTML Goodies, or would you rather see banner ads and have HTML Goodies remain free to all?

Would you pay a dollar for a Snickers bar?

As Jerry Reed sang in his song "U.S. Male", I said all that to say all this...

The Web is a place where advertising abounds and as much as people complain about the number of banner ads, I'm not so sure they would want the alternative. As I stress again and again, to run a serious domain on the Web is rather expensive. Those banner ads keep it all free to you.

What I have always wanted to know is how people would react if the advertising banner shoe were on the other foot. What if you, the end user, could have banner ads work in your favor? What if you could basically do what I do and post banner ads to help pay for the things you do on the Web? Sure, you hate looking at banner ads...but would you use them?

Would you listen to the five-second advertisement before making that phone call in order to drop your bill?

First you paid to use e-mail. Then came the free e-mails like Hotmail and Yahoo mail. Now the progression continues. You can get paid to send e-mail.

A Denver-based company named Epidemic Marketing has decided to try just that. If you sign up with Epidemic, your e-mail will be sent with an advertisement attached to it. If the recipient of the e-mail clicks on the advertiser's get money.

Sounds like a deal, huh? Would you do it?

Furthermore, Epidemic Marketing offers the ability to set up what they call "epiGroups". This is intended to capitalize (no pun intended) on group buying power. For instance, a middle school can make it so that every single e-mail that leaves their server carries the ads. All the money they make will go towards helping the school. It's an e-mail fund-raiser.

Epidemic Marketing CEO Kelly Wanser puts her spin on the concept by stating: "This empowers individual e-mail users to share in advertising and direct marketing revenue."

Is there a down side? I think so.

To begin with, you need to download a small program so that Epidemic can have access to your e-mail so that it can attach the ads. They claim your content is safe. I have no reason to not believe the company, but it still makes me a little nervous. They also claim they'll not know who the recipient will be. Hmmm...

Once the ad leaves Epidemic, it's really up to you who will get it. Will Epidemic allow pornographic sites to advertise? If so how will that look when you send an e-mail letter to your five-year-old niece in Baltimore?

Can anyone else see groups of students getting together and sending massive amounts of e-mail around the University hub each clicking on whatever happens to show up in their mailboxes just to get the cash?

Can anyone else see this becoming a spam-creator? I can just see my e-mail box filling with "Please click this link" subject lines from young people trying to make their money.

And much cash can you make? I have three sources that each reported this story, USA TODAY Tech, CBS News, and CBS Marketwatch so I am pretty sure this is a legitimate deal. What I couldn't find was Epidemic Marketing. The company started up in April, but doesn't yet have a presence on the Web, at least not one that I could find. I want to know how much you really make (or get taken off of your ISP bill) for using the service.

I'm going to base my cash-flow thinking on another similar deal, Bannermania. This is much the same as described above. You put a Bannermania banner on your site and every time someone clicks on it, you get a penny.

Let's pretend that a penny is the sum Epidemic Marketing is offering for a click. I would actually be floored if it was more. Taking the normal $20 fee to sign up for an ISP, you would need to have 2000 click-throughs to break even. I would suggest that even the most hardened group of college students would give up on trying to do that once a month.

So, now we come to the realization that you won't get your e-mail for free, but you might get a buck or two off a month. However, in the process of getting your buck, you've provided Epidemic Marketing with a great deal more cash. If they're giving you a penny for the click through, I'll guess they're getting at least the same if not more.

Is it worth it to you? Would you attach advertisements to your e-mail? If what I describe above is true, many of you might still stand by your guns and say no.

But this is only the beginning. Soon advertising deals will be struck between ISP's and businesses that actually will allow you to get your e-mail for free, or better yet you make a little bread. You get $20 a month to put in your pocket and the ISP gets $40 from your reader's clicks. It's going to happen. Maybe Epidemic Marketing is just that: Free e-mail plus cash. I doubt it but what if it is?

What if attaching advertisements to your e-mail could actually make you a few bucks. Then what?

Would you pay a dollar for a Snickers bar?

Would you attach advertisements to your e-mail for profit?

Is that your final answer?


That's that. Thanks for reading. Last week's newsletter produced a ton of e-mail. I can't wait to see what happens with this puppy.

Joe Burns, Ph.D.

And Remember: You've heard the term "slush fund" referring to extra money set aside by politicians. You may think that "slush" means icy water. Nope. It comes from a time when sailors would cook all their pork before leaving for sea. The pork was put into barrels and covered with pork fat known as "slush". After the sailing trip had ended, the sailors sold the slush for a few extra bucks they called...a slush fund.

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