by Wendy M Grossman | posted on 21 April 2006
LiveJournal, home to approximately 1.3 million active blogs and 10 million overall, announced this week that it's inaugurating ads on its site, following on from a post on the subject from the founder about six weeks ago.
The general idea isn't all that dissimilar to what Salon has been doing for the last five years with its Premium service: you pay for the value you receive with either ads or money, your choice. LiveJournal has always offered free and paid accounts, basing the incentive to pay on limiting the features available to the free accounts. Now, it will offer an intermediate "Sponsored" level which will include ads. If you're a logged-in paid user you will never see ads; if you're a free or sponsored user (or visitor) you will see ads on LiveJournal's main site and on sponsored journals. No one has to display ads on their journal.
Almost simultaneously, Six Apart, the owner of LiveJournal, announced that it had secured $12 million in venture capital funding. LiveJournal was a cooperative community; now it's a business.
We will pass over quickly the storm-in-a-Slashdot about the changes to LiveJournal's terms of service that banned the use of ad-blocking software on pain of having your account deleted. LiveJournal has already said the clause was a lawyer's error. It must have been: it would have been such a pointless, stupid, and self-destructive clause that it's hard to believe anyone ever seriously intended to implement it. For one thing, such a stick would have had no effect on anyone not logged in. For another, we've had so many of these TOS thrashes by now that there can't be a remotely technically savvy management team that doesn't know how much negative attention they'll get from this kind of announcement. Posting new TOS that no one has read and considered carefully isn't too bright either, but it's a mistake not evidence of Evil.
The advent of ads will be interesting. LiveJournal isn't just a blogging site; it's a powerful cross between blogging and social networking. On most social networking sites, the links between people are tenuous and ill-defined. There is no distinction on Orkut, for example, between a friend I've known intimately for years and a "friend" I met for five minutes last week. There is only one kind of link, and it doesn't tell you much.
On LiveJournal, however, it implies real interest, if not friendship, if I add someone to the list of blogs on my friends list. There is still only one kind of link, but it is more meaningful, and some conclusions about its strength can be derived from seeing whether it's one-way or two-way, and how large a cluster it's part of. If the goal is ads targeted to people's interests – which would be logical – LiveJournal has a very rich structure to mine and an even richer base of information about all its users based on what they post about themselves in their blogs. You can see why ad sales people might salivate over the notion, particularly in the wake of this week's other blogging story, the one about graphing the mood of the blogosphere, specifically LiveJournal's part of it.
That technology strikes me as gimmicky: it relies on self-reporting. I look forward to the first mass protest via LiveJournal mood tags, when users club together to post specific moods so they'll show up on the graphs. The concept, however, is likely to develop further into datamining and textual analysis of the blog entries themselves (which are less likely to be spoofed, because of the amount of effort involved), and it's easy to imagine how valuable those results could be to marketing people trying to spot trends they can capitalize on.
The problem LiveJournal is up against in all this is that the lock-in they have for customers isn't as good as it might seem at first. In fact, the lock-in for LiveJournal is considerably less than it is for Google, whose audience financial analysts used to regard as alarmingly easily lost. It wasn't true of Google, largely because Google was so much better at what it does than everyone else is.
But it doesn't take much to start a blog somewhere else. The tools aren't much different, and you don't have to take down or lose the old blog to do it. You just start the new one with an entry pointing at the old one, and move on. The phemonenon of RSS readers, online and off, mean that the socially networked LiveJournal structure can be mimicked almost anywhere by anyone – and those tools are going to continue improving. More than that, if you have any hope of turning your blog into a source of income, however tiny, you move off LiveJournal because you can't run your own ads. If LiveJournal wants its new gambit to work, it's going to have to give sponsored users a slice of the action. Because, aside from anything else, sponsored users are going to find themselves at the bottom of the social LiveJournal totem pole. Everyone will know who they are. And they won't get anything for it.
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Wendy M. Grossman’s Web site has an extensive archive of her books, articles, and music, and an archive of all the earlier columns in this series. Readers are welcome to post here, at net.wars home, follow on Twitter or send email to netwars(at) skeptic.demon.co.uk (but please turn off HTML).