Reaction to Yahoo’s decision mixed, but one thing is clear: a lot of people will be affected.
One day after Yahoo (YHOO) dropped a bombshell that it would no longer accept arbitrage traffic to its advertising feed, the reaction has been swift and loud. I’ve been monitoring domain forums and this is what people have to say:
“well…back to working for a living…”
“I’ll need to get back to SAP consulting. I’ve kinda forgotten some of my transaction codes…”
“Quit whining+being lazy and start developing your domains TONIGHT you all… (this goes to myself too.)”
“MSN and google just lost minimum of 15k a month from me and yahoo just lost the revenue on the back of the traffic I was sending through parked.”
“No more xx,xxx$ a month”
“Many people like me were doing arbi for a living making my 15k a month and to say my traffic was trash is just plain silly. A TQ score of a 10 seemed to be ok with yahoo and parked and since parked only allowed traffic from google and MSN then I assume it was good traffic. There is a lot of people this is going to have an impact on and yahoo has no idea how much. My opinion is this is being done as a direct threat on GOOGLE and MSN in a self survival mode.”
“I think it’s going to be BIG losses actually. I’m going to call my broker on Friday morning…time to get that Google stock i always wanted”
Of course, not everyone is upset. A number of people have come out supporting Yahoo’s decision, suggesting that arbitrage traffic isn’t as good as type-in traffic. If you believe that direct navigation traffic converts better than search, then this would be true.
One thing’s for sure. This move will affect many peoples’ lives. I’m a bit shocked by how many people have jumped on the arbitrage bandwagon making $10,000 or more per month. This could also make even more heads roll at Yahoo. If my back-of-the-envelope calculations are right, Yahoo might have to layoff another 1,000 people to make up for the revenue loss.
Personally, I have not done click arbitrage. However, I’m sure a lot of the affiliate revenue I make from Parked.com is arbitrage. I won’t know for about another month how much of that I’ll lose.
What do you think? Was arbitrage good? Bad? Was this a good move by Yahoo?
Is anyone else wondering why Moniker’s auction inventory is not available yet? I called this morning and was told it would be up later today, but that is what they have said everyday.
It’s very frustrating for those who are waiting to find out if they have names in the auction, and for those who are attending the conference and need to spend some time researching some of the 2,500 domains available. You can’t do it at 10,000 feet on your way to Vegas.
What about the potential to get some PR on these names prior to the auction to drum up some interest? If potential buyers don’t know what domains are going to be available in advance, what is the chance they will register before the show to bid online?
It seems like it is a wasted opportunity to really make the results of the auction be mind blowing. So many eyes are on the industry right now, and there is no room for error. I bet this TRAFFIC will be the best yet, but think how much better it could be if the auction catalogue was available a few weeks earlier..
So what is the consensus? Are we going to see the value of our clicks go up or down?
@Chris – maybe they’ll go up *slightly* in the long run on Yahoo, but they’ll probably go down on Google.
@Andrew – Interesting. I’m very curious to see how this plays out – industry-wide.
This is good and bad.
Good for people that run an actual business. Meaning now you will not have to compete with 3 or 4 other arbitrage websites in the same category. This will acutally reduce the cost for a real business that uses yahoo for marketing, you will have less competition. It sometimes gets ridculous when you have the same add going to one network then to another then to another. Abuse has finally lead to restriction “sad but true”. Bad for people that depend on that money for a living. CPA will start to lead the way. I would rather pay for a 50.00 acutal lead than spend 200.00 through horrbile clicks to get that lead. Market will become more efficient. Websites like surehits.com and brokersweb.com will keep springing up. Other category sites will start emerge.
My prediction.
MSN will raise bid to 38.00 or so and newscorp and some other outfit will be the pawns to make msn raise the bid.
Bad for
A lot of portfolios/domains are of somewhat poorer quality, and without arbitrage those names will get no natural traffic … resulting in increased drops. Higher quality generics will benefit from this shift.
I’m jumping in. I was a small time arbitrage player. Mostly parked.com. I have an offline job, so I’m not freaking out, but I am dissapointed.
One comment was to the effect of “run a real business”. Arbitrage is a real business, and a complex one that carries significant risk. Another suggested it’s good for ‘real advertisers’. Well, any so called ‘real advertiser’ could have got the same traffic I got if they took a minute to figure it out.
Is the traffic so terribly terrible? Probably not, if it’s first tier stuff, recycled once. Imagine the conversions if I was actually trying to sell a stupid ringtone with my bottom fishing clicks. But, the ‘potential’ customer that I fish up and still wants to swim – now that’s potential!
And then there’s branding. Do you think anyone has ever clicked on a billboard on the side of a highway and had a burger appear on their lap? Uhhh, no. It’s a pre-sell – a primer – a “hay I need that” call. No arbitrage is like taking away billboards because they suck at customer relations.
Anyway, it was fun, it was profitable, and I sincerely morn the loss of capitalism to big business-alism. 😉
Cheers!
Mike
One more point. (Indulge please)
This cheering about how easy or better it will be for the business models that are not affected (like so called natural traffic), it’s gross. Think about it. “I will do better because the ‘system’ eliminated the competition.” Is that what anyone really wants?
I am still working on arbitrage and driving traffic from 1st and 2nd tier search engines making millions of $$ for my company where i am working on arbitrage platform for last 5years, i am surprised to see comments that none of you making $$
Cheers