This Week's Clue: Winning at Portalnomics 

Shoot the Messenger 

It's a Small (Internet) World, After All 

What Can The Suits Do? 

Clued-in, Clueless

All the hoopla about portals  obscures the fact there's still plenty of room for more of them. No, we don't need another Yahoo, but we all have special, consuming interests -- local interests, hobbies, and industries -- where we really need a guide. If you become that guide, becoming the default page for just 1,000 people, you can make yourself a fortune. 

Dan Janal  made this point well in his most recent letter, but perhaps John Patrick of IBM  made it better in his Summer Internet World keynote. He discussed a recent speech he gave to the forestry industry, noting that in his research before the speech he came upon the site of University of Washington student Steve Shook  with links to the entire forest products industry. Patrick asked his forestry industry audience if they knew Steve Shook, and no one did. He suggested they find him. "This could be International Paper and Steve Shook," he said, and every industry has a Steve Shook, someone with a passion for a specific field or place, who can connect everyone within it. 

So, what does it take to become a portal? The key words are passion, and connecting everyone. Today's general-interest portals retain their power mainly because they lack competition on the local or special interest level. They lack competition for two reasons - the general cluelessness of publishers, and the lack of business savvy among the Steve Shooks of the world. (An admission here -- I'm more a Shook than a publisher, myself.) 

Forrester Research's Jim Nail  made this clear in an interview he conducted with me last month for Business Marketing . He found start-ups expecting to earn $1.8 million on b2b education and lead-generation sites, while publishers were expecting an average of just $300,000 in revenue this year on their sites. Not only do the start-ups offer better education, they "have more robust directories, searchable based on types of product," he told me. The new sites offer what he called "transactive content," blending elements of transactions, interactivity and content. 

I like databases, so for a site like Steve Shook's to become a real portal, it seems to me he needs to make his database of links searchable, and he needs to take the initiative in reaching the industry and building a business. Nail's point is that Shook is closer to building a forest products portal than any current participant in the industry, or any industry publisher. 

Now, you want some Clues for making money? Find folks like Shook, and offer them the capital and expertise they need to become a true portal. Their passion is the key to making these things work. Help them build their databases, market their work, add education to their services and build marketplaces, both directly and through links. I know of many start-ups, in health  and elsewhere, trying to build special-interest portals based on a daily news briefing and links. To succeed, they must go further. They must mediate communication while retaining credibility, the way John Audette does with his lists . They must also go further than John, offering courseware, commerce and advocacy. 

In order to become a portal, in other words, you have to combine several elements. Top Hosts, for instance, offers an interesting database and services based on traceroute technology. What it lacks is the editorial focus, passion, and community building of something like Boardwatch, now part of Mecklermedia. 

There are still huge fortunes out there, waiting to be made. Each of these fortunes will take a little bite out of the current portalmania, until sites like Yahoo have no more of the market than they deserve. Your Clue is to not worry about CMP Media, about the existing portals, or about anyone else's business plan. Let your passion show, build on it, don't be afraid of success, and you have a shot. 

Boardwatch Magazine  will begin running my e-commerce column in September. I'm looking for details on the technology behind some of the most successful online stores. We now have about 700 readers on the A-Clue.Com list, and there may be as many as a thousand more visiting our Web sites each week (including Sean Cafferky's PPN and Tom King's CompuTalk . That's because we not only deliver news and insight, we deliver it in a fun, entertaining way. It's the thought that counts, and as always I very much appreciate yours. 

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And now back to our show... 

Shoot the Messenger  

Two news stories, and reaction to them, should make all of us who want to use the Internet to uncover wrongdoing sit up and take notice. 

In Canada Philip Services, a company accused of using slick accounting tricks to increase its market value, won court orders and the names of Internet users  who had maligned the firm on Yahoo's investment boards. A possible aim is to either sue these people for libel or, if they're working for someone with knowledge of the truth concerning the allegations, shut them up in other ways (maybe charging theft of trade secrets). The Electronic Frontier Foundation called the ruling "very disturbing," but the case made little splash because it was, after all, from Canada. 

Now America Online has shut down a Web site critical of The Orange County Register, a conservative California newspaper. The Register's owner, Freedom Communications Inc., had sued two "John Does" for infringing its copyright, because they called their site the "Orange County un-Registered Press." More alarming, AOL then gave the Register the name of the site's operator, a person using the screen name Slave4OCR, who claimed to be a former employee of the newspaper. The site featured rumors, gossip and complaints from co-workers who, like the Canadian critics of Philips, sought to remain anonymous. (You won't hear this story from Drudge  because the Register's politics protect it.) 

AOL's excuse was the copyright infringement, the use of the Register's name on the site, and the presence of a subpoena. The excuse is flimsy. The site didn't use the Register's actual name, but was a satire of it. Subpoenas can be suppressed, if you're willing to fight them and have a good case. Consider that the aim of the paper may have been to harass its own employees, and prevent airing of its dirty linen. That could allow any firm disparaged on, say, Motley Fool  bulletin boards a license to shut down debate on business practices. File a suit against unnamed critics, get a subpoena to obtain their names, then sue for (pick one), libel, theft of trade secrets, or deceptive trade practices. Fool users should take note of this case, the Gardners' reaction to it, and act accordingly. (Your Clue here, if you've missed it, is that if you don't protect your users, you don't deserve any.) 

The previous precedent in this area was "Stratton Oakmont vs. Prodigy," in which someone on a Prodigy board accused a Long Island firm of being a "boiler room," cold-calling victims and kiting stocks. Stratton sued Prodigy, and won, because a court held that Prodigy was claiming to be moderating its boards, and thus was taking some responsibility for their content. (A few years later, I read, Stratton Oakmont settled SEC charges that seemed to make the same accusations as the Prodigy user, without admitting any wrongdoing.) There was also the case of "Cubby vs. CompuServe," in which the online service won a suit aimed at one of its information providers, by claiming it was an innocent victim of someone else's upload and thus couldn't be held responsible for material it didn't create. In other words, the precedent until now has been that if you didn't control the content you're not responsible for it. Practice has been that individual, anonymous users haven't been worth intimidating. 

The AOL-Register encounter, however, unlike the Canadian case, is not a legal precedent, because AOL simply refused to fight. Some will fight , and your Clue is that those who fight will win. There are lots of lawyers out there, some representing crooks, others covering-up for mere embarrassment, still others protecting the good name of clients, whose suits aim to stifle Web speech. Those who fight such tactics will earn loyalty from their users, higher usage fees, and lots of money. 

It's a Small (Internet) World, After All  

In case you haven't heard it yet, the Summer Internet World in Chicago  was a fiasco, at least from Alan Meckler's point of view. There were no big exhibitors, attendance seemed down, and even though it was far more useful than ever before (the best show yet for those serious about doing business online), that won't help on Wall Street. Meckler told CNBC a few weeks before the event trade shows are his sole profit center - the magazines are marginal, the Web sites only "cash flow positive." 

Meckler must make a go of his new ISPCon shows , turning them into a true threat to Ziff's Networld + Interop operation, in order to make his Boardwatch acquisition pay. Comparing those two events this fall will tell us a lot. Measuring the crowds, and booth space, at the October Fall Internet World show in New York will tell us more. 

Who needs Internet World, or any similar trade show? It's the allure of the new - new products, new categories, new ideas - that keeps people coming back. Your Clue if you need such shows is to keep your eye on that ball. 

What Can The Suits Do?  

NBC has named the suits it says will make Snap  jump over its search engine rivals. Most, like new chief operating officer Edmond Sanctis, come from NBC Digital Productions, not MSNBC. What's interesting is this sets up a market battle not only with the current portal crowd, but with Microsoft , which has apparently kept its own development team intact. Can this "old media" team "get it" in time to beat both Big Green and portalnomics? I don't know, and I don't care, but I guarantee that over the next six months this story, and that last sentence, will be replayed ad-nauseum in the media and on the big media's Web sites. 

Clued-in, Clueless 

Clued-in is Link Exchange , which created a discount deal with Microsoft's Site Builder Network , gaining the opportunity to prove its market power to Big Green and through them, to the rest of us. 

Clueless, again, are columnists like Mona Charen who bought a pornographer's scam  and used it to once again demand the shredding of the First Amendment and attack the ACLU. What's more Clueless is her forgetting that the First Amendment, like every national law, is merely a local ordinance. What's most Clueless is that her censorship advocacy gives other nations all the excuse they need to go after their own citizens . You don't defend free speech by defending people you like, but by defending those you detest. Making freedom conditional on being in like you is, and has been, the game of every dictator throughout history. Mona has made her choice. Don't let her forget it.