Wilfrid Posted September 10, 2011 Share Posted September 10, 2011 Google has certainly changed direction because it's nervous about search. Whether they are now headed in a better direction is an interesting question. I am inclined to think making changes is better than doing nothing and hoping for the best (more Yahoo's style). Quote Link to post Share on other sites
Orik Posted September 10, 2011 Share Posted September 10, 2011 ... 1. it shows a loss of direction at Google ... 2.but this is really a rather expensive way to resolve that issue ... 3. if WSJ is correct, the deal reflects an insanely high valuation for Zagat. 1. How so? 2. What do you perceive the "issue" to be? And what is the cheaper path solution to solving that issue? 3. Have you seen Zagat's P&L statements for the last 5 years? If not, on what basis do you make that statement ? 3. I don't have time to look but I do remember GS was marketing them for $200mm with an implied multiple of 25-ish just before the credit implosion thingie, so I would imagine they were making $8mm/year and there's no doubt the brand was far more valuable a few years ago than it is now. So let's say $125mm is about a 15-ish multiple at the moment, which I believe is high because if this deal didn't occur I'd view zagat as likely to continue its decline. 2. The issue is that unwilling content providers are either legally challenging GOOGs rights to make money off their content, or just hiding it from GOOG completely (social networks). A cheaper path is for GOOG to learn how to do marketing and turn some of its obviously superior products, coupled with the public hate and despise towards Facebook, for example, into content and meta-content. I think in some way they're viewing buying Zagat as similar to buying business contact info from credit card issuers, but it's not really the same. 1. Wilfrid is right that search alone in a hostile environment is not going to cut it, but there are many other tech-heavy areas that a company where the typical employee was until recently an extremely talented science/math PhD might want to explore before they go into restaurant reviewing/content generation (and not in the way described in (2)) Quote Link to post Share on other sites
Wilfrid Posted September 10, 2011 Share Posted September 10, 2011 The big question for several years has been whether a bunch of smart engineers can do social, but that's what Google is all set to do, and looking at the stats on the success of social (and mobile platforms) it would be crazy not to. The Zagat acquisition just seems lazy, but maybe the brand has very positive connotations nationwide (NYC hardly representative on this; I just don't know about overseas). Quote Link to post Share on other sites
Orik Posted September 10, 2011 Share Posted September 10, 2011 The big question for several years has been whether a bunch of smart engineers can do social, but that's what Google is all set to do, and looking at the stats on the success of social (and mobile platforms) it would be crazy not to. The Zagat acquisition just seems lazy, but maybe the brand has very positive connotations nationwide (NYC hardly representative on this; I just don't know about overseas). Overseas it has a better reputation than in nyc in a few places, but generally it is significantly weaker than Gayot (to put things in perspective). The only users are Americans from the middle. The reason why social success has eluded google is exactly that it needs almost no technology the way it's been implemented so far. Quote Link to post Share on other sites
Sneakeater Posted September 10, 2011 Share Posted September 10, 2011 Does your expensive, lightweight laptop not have a solid state drive? It's a spinning drive that uses energy and takes time to wake. OF COURSE it has a solid state drive. Jeez. ETA -- Oh I see your point. OK: sleep from now on. Quote Link to post Share on other sites
Wilfrid Posted September 10, 2011 Share Posted September 10, 2011 The reason why social success has eluded google is exactly that it needs almost no technology the way it's been implemented so far. Mm, I think that's right. Google+ is competing with FB on a design basis. Quote Link to post Share on other sites
Sneakeater Posted September 10, 2011 Share Posted September 10, 2011 Thanks to cstuart and Dabbler. That was life-changing. (In a small way.) Quote Link to post Share on other sites
Stone Posted October 27, 2011 Share Posted October 27, 2011 $151 million, according to Eater. I'm curious, do you guys think this was a good business decision on Google's part? What does it say about Google's intended growth trend? Can we draw any conclusions about the future of on-line video delivery services? How long is a reasonable wait for Google to announce the successor CEO? Quote Link to post Share on other sites
Wilfrid Posted October 27, 2011 Share Posted October 27, 2011 I wrote something about this when it first broke. Google was using a variety of sources to provide information to accompany search/map results for restaurants and other businesses. Some of those sources were protesting breach of copyright (Yelp, I think). This is an expensive way of solving that problem. Zagat was withdrawn from the market in 2008 when it couldn't reach a sale price of $200m. Given the steady decline in of its market dominance since then, I think it did well to achieve $151m. Perhaps Google could have driven a harder bargain. Whether it's a good investment depends, in my opinion, on how appealing the Zagat brand is to consumers nationwide and overseas who rely on Google search. Does it give a stamp of authority to reviews and opinion? I can't judge that very well, because while I think the Zagat brand is somewhat faded in New York, I am not sure it's equally faded elsewhere. Quote Link to post Share on other sites
Lex Posted October 27, 2011 Share Posted October 27, 2011 Whether it's a good investment depends, in my opinion, on how appealing the Zagat brand is to consumers nationwide and overseas who rely on Google search. Does it give a stamp of authority to reviews and opinion? I can't judge that very well, because while I think the Zagat brand is somewhat faded in New York, I am not sure it's equally faded elsewhere. While the Yelp brand is shiny? One of the things that gave Zagat reviews a surface plausibility was that the truly stupid comments were edited out. On Yelp they appear in all their pissy 23 year old glory. Jackasses who dock a restaurant 2 or 3 stars because the bread bowl wasn't replenished or the bar didn't have 20 different kinds of "martinis." I'm going to start a Worst of Yelp thread. There are things on there that make Chowhound look refined and polished. Quote Link to post Share on other sites
Wilfrid Posted October 27, 2011 Share Posted October 27, 2011 I didn't mean to imply anything positive about Yelp, although I suspect the brand perception in NYC is that it's fresher and more useful than Zagat. Quote Link to post Share on other sites
Lex Posted October 27, 2011 Share Posted October 27, 2011 I didn't mean to imply anything positive about Yelp, although I suspect the brand perception in NYC is that it's fresher and more useful than Zagat. I bring you the Worst of Yelp. Yes, I know you didn't mean anything positive about Yelp but that site really needs to be called out what it really is - Zagat's without an editor. In a way that's a good thing because the ninnies stand revealed in all their glory. But it's also a bad thing in that their opinion gets factored in with everyone's. It might not be politically correct but there are some people who are too stupid to be allowed to vote. Quote Link to post Share on other sites
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