Why Publishers Don't Care (Yet) that the Mobile Web is so Awful

by Peter Rojas

There has been a lot of (justifiable) complaining lately about just how awful browsing the web on a mobile device has become. The main culprit? Page sizes, which have grown rapidly in recent years. HTTP Access reports that the average site today is now double the size of the average site from just three years. Bigger page sizes mean increased page load times, a problem which is especially noticeable when browsing on the smaller screen and slower connection of a mobile device. 

You can guess why it's gotten worse. As phones have gotten more powerful and mobile networks have gotten faster, publishers have felt less inhibited when it comes to increasing page sizes than they did at the dawn of the mobile era. These days they're loading up their sites with not just banner ads, overlays, and video players, but all manner of ad network trackers and beacons. More people consuming content on mobile devices means advertising dollars and ad networks, giving publishers opportunities to make money off of their mobile traffic that didn't have just a few years ago. But the real reason why publishers have become so comfortable with making the reading experience on mobile miserable is because they can get away with it. The reality is that they don't care if you hate them. 

It sounds crazy, since you'd think that most websites would care a whole lot about keeping their audience happy, but the rise of social -- and really we're mainly talking about Facebook -- as an enormous driver of traffic has changed the nature of the relationship between websites and their readers. Why? Because Facebook has become the primary interface for hundreds of millions of people for experiencing the web. We don't usually think of it in this way, but the News Feed breaks that direct relationship between websites and readers by unbundling sites into their individual components (i.e. articles and videos) and then re-aggregating them into a largely undifferentiated stream that's algorithmically customized for each user. In a lot of ways this is great for users -- they get to see stuff tailored to their interests without having to put any effort into going out and finding it. It's not entirely bad for publishers either, since Facebook's huge user base offers them a way to grow the audience for their content. 

However, there's a big difference between someone choosing to go to a site because they enter the URL into their browser, click a bookmark, or subscribe to their newsletter, and someone who ends up at a site because they clicked a link which someone shared on Facebook. That difference is the depth of the relationship that the user has to the site. Quite simply, you probably care a lot about the sites you choose to go to directly, and you go back because you know you'll get a quality experience. You don't have that relationship with sites you click on in Facebook. You go because someone you know shared it, and you may not even pay all that much attention to what the name of the site is before you click the back button a few seconds later. In fact, the person who shared it might not have even read it themselves. A study by Chartbeat of 10,000 socially shared pieces of content found that, "There is no relationship whatsoever between the amount a piece of content is shared and the amount of attention an average reader will give that content." 

In the early 2000's the realization that Google was driving tons of traffic led to SEO-obsessed content farms focused on gaming search engine result pages. Similarly, social sharing has changed the dynamics of web publishing and led to a whole host of sites which are focused on creating content they hope will go viral on Facebook. Some of them, like Buzzfeed and the Huffington Post, have done phenomenally well and grown into big businesses, while many older sites have reoriented their traffic acquisition strategies around Facebook in order to keep up. You can see it in how headlines have changed. When the key to driving traffic is getting people to click through on Facebook, you end up with the kind of clickbaity headlines that Upworthy and Buzzfeed pioneered. 

When you break that direct relationship between readers and publishers, you also take away a powerful incentive for publishers to offer those readers a high-quality experience. If there is going to be little or no reputational hit to the brand -- or if the brand doesn't even matter all that much anyway -- someone coming to your page and being exposed to a ton of advertising isn't a bad thing at all. Given the unlikelihood that the publisher will convert them into a direct visitor later on, it's entirely rational for them to optimize for short-term gain, and that means trying to get that visitor to like the page (to drive more traffic) and to be exposed to as many ads as possible (to drive as much revenue as possible). Users might be a bit annoyed by the load time (which they may blame on their phone's connection rather than the site), the preponderance of ads, or the number of pages they have to click through to get to the "actual" content, but as long as the publisher can continue to craft headlines which generate clicks there is little reason for them to change what they're doing. You can see this same dynamic at work in those "Suggested Links" modules powered by Outbrain and Taboola at the bottom of articles. Have you ever noticed how obscure many of those sites are and how determined they are to get you to click on as many pages as possible to read the whole article? 

Sites which rely on their audience to make a conscious decision to go and visit them have the opposite incentive. They want your visit to be pleasant, so they avoid the pop-ups and click-throughs. This sacrifices the short-term value of all that potential advertising revenue they might have made on that one visit for the long-term value of keeping you as a regular reader. I don't have any data on this, but my hunch is that that there is an inverse relationship between how much of a site's traffic comes from direct visitors and how much intrusive advertising and other crap visitors have to deal with when they go there. However, it's easy to advise publishers to make the strategic sacrifice -- to have fewer ads in order to build a brand that some users will want to visit directly or for longer -- but for most of them this would be suicidal.

No one much likes advertising, but it's how most online publishers pay the bills, so it's unlikely that this will change anytime soon. Unless, of course, Apple and Facebook find a way to upend all of this. Facebook's new Instant Articles is such a big deal because it attempts to solve the mobile web experience problem by essentially deprecating the web itself. With Instant Articles publishers host their content within Facebook itself, so instead of clicking out to a web page users stay within the Facebook app and get a faster loading, cleaner version of the same article. (In Facebook's post announcing Instant Articles they pointed out that the average article has an unacceptably long load time of eight seconds on mobile.) Facebook is allowing publishers to keep 100% of the revenue of ads they sell themselves (at least for now), though whether publishers will be able to make as much money hosting their articles on Facebook rather than on their own sites is an open question. The point is that it's not hard to see Facebook's algorithm prioritizing Instant Articles because of how quickly they load (just like how Google has made page load time a factor in how it calculates search results), which would essentially force publishers to choose between either improving their own mobile websites (by reducing both the number of ads and their intrusiveness) or giving in and just publishing to Instant Articles. 

Without much fanfare, Apple has decided to allow developers to build ad blockers for mobile Safari in iOS 9. It's hard to tell right now exactly how big of a deal this is going to be for publishers. Reactions range from "this is an impending apocalypse" to "everything will be just fine." Very few publishers are unconcerned about the effect on mobile ad revenue. Given the precarious position most publishers are already in, even a small decrease in income can be extremely painful. I can tell you from my time at AOL that desktop ad blockers had a material impact on revenue for several properties and it's hard to imagine mobile ad blockers not doing at least some damage. But, I also know from the user's perspective why mobile ad blockers would be so attractive -- they'll go a long way towards making the web usable again on your phone. Apple, which makes hardly any money from mobile advertising, probably cares very little if Google, which dominates the mobile ad market, suffers. As far as for publishers, it's probably not at all surprising that Apple has its own Instant Articles-like solution for them called Apple News which purports to fix everything that's wrong with reading the news on the mobile web. It's not clear yet what Apple's long-term plans are for Apple News, but if publishers are losing significant amounts of money because of mobile ad blockers, they're likely to be a lot more receptive to whatever solution Cupertino offers to help mitigate the situation.   

However things turn out, in the short-term publishers are going to find themselves in an increasingly tough position. It's already become a lot tougher to rely on Facebook for traffic. The competition for eyeballs keeps ramping up as more and more publishers figure out how social works. Simultaneously, Facebook keeps tweaking the News Feed algorithm in ways which make it harder and harder to reach audiences -- unless of course you want to pay for the privilege. It'd be one thing if there were some other source of traffic on the scale of Facebook or Google on the horizon, but as far as I can tell there isn't. (Side note: if you want to build a $250 billion business, just figure out how to drive as much traffic to the web as Facebook and Google do. If you are working on this, please get in touch.) In the meantime most news sites are going to do exactly what they're incentivized to do right now, and unfortunately for us, that means optimizing for ad revenue, not a great mobile web experience.

What I'm doing as an Entrepreneur-in-Residence

by Peter Rojas

I promised a few weeks ago in my post about leaving AOL that I'd have another one up soon detailing my new role at betaworks. I'm not sure where the past few weeks have gone, but jumping into a new job at the same time as moving from New York to San Francisco pretty much destroyed all of my free time and so I'm only getting to this now.

"Entrepreneur-in-residence" can be sort of a murky job title; it certainly has come to mean different things for different people at different places. (Side note: does anyone know the first time it was used?) For me being an EIR means working with betaworks' investing team to find early stage startups to invest in, as well as advising and supporting portfolio companies based here in the Bay Area. I knew I wanted to move into investing after I left AOL and this was the perfect way to learn the ropes from some amazing people while figuring out what comes next.

The funny thing is that I even though began my career in technology as a journalist writing about venture capital and startups for Red Herring, it never occurred to me at the time that I would  become an investor myself. I was never much interested in finance and it really wasn't until I started my own company and went through the fundraising process that it began to see early stage investing as something that I might want to do. 

What I found is that early stage investing is  different from other kinds of investing. It's more subjective, for starters. Products and companies are so young that you rarely have much hard data upon which to base a decision, and because of that the process is driven more by intuition and relationships than financial models and analytics. You're essentially making a guess about the quality of a company's product (and its potential to grow), the future size of the market it's going after, and the drive and capabilities of its founders. It's about looking out over the horizon and making a bet on how technology is going to change the world.

In one way or another, pretty much my entire career has been focused on finding that next exciting thing in tech. Editing Gizmodo and Engadget was exhausting -- and something I never want to do again -- but it was exhausting because I was fixated on chronicling every single exciting new product or development in the world of personal technology. I don't blog much anymore, but I still love playing with new gadgets and apps and I'm just as obsessed as ever with trying to figure out what the next wave of innovation is going to be. If you're passionate about new technology and love being around the people working on it there are probably few jobs as well-suited to fueling that passion as being an early stage investor, which is why it seemed like a natural next step for me after being an entrepreneur.

I know that I have a lot of work to do if I want to be any good at this. One of the biggest challenges is going to be finding new opportunities early, so if you are working on something I might be interested in checking out or even just want feedback on what you're building, please get in touch. I'm especially interested in chatting with anyone who has had a hard time getting in front of investors because they don't have the right connections. I know how difficult it can be to get investors' attention, so I highly recommend taking advantage of the fact that I'm new to this! 

Leaving AOL (again)

by Peter Rojas

Yesterday was my last day at AOL. Today I'm joining betaworks as an entrepreneur-in-residence, focusing on seed stage investing, as well as working with portfolio companies here in SF and just generally serving as their ambassador to the West Coast. It's a big change for me and I'll write more about it in a later post.

The last time I left AOL I never made an announcement or posted anything to my blog. I've always felt uncomfortable saying goodbye -- I have a bad habit of trying to sneak out of parties -- but looking back I really regret disappearing like I did. I was already working on a couple of new projects (RCRD LBL which went nowhere, and gdgt, which brought me back to AOL in 2013) and at the time I only wanted to focus on what was ahead of me, not behind me. Of course, I realize now that I left without thanking a lot of people at AOL or acknowledging the hard work of the team that I was leaving and I won't make that mistake this time.

First, I have to say thank you to my team at AOL Alpha, who are without a doubt the most talented and capable people at the entire company and who I've been very lucky to have had the opportunity to work with. They've all done amazing work and I look forward to seeing what comes next out of Alpha. I especially want to thank Evan Fribourg, Michael Cosentino, and Drew Lesicko, who ran Alpha alongside Ryan and me. Their dedication to Alpha has been inspiring and I am going to miss working closely with each of them.

I owe a debt of gratitude Jay Kirsch, who helped spearhead gdgt's acquisition by AOL. Anyone who has ever sold their startup knows that you need someone who believes in you championing your deal internally if you're ever going to get something done and we were lucky to have Jay be that person for us (plus he was awesome to work for after the deal closed).

I also want to thank Susan Lyne, who made me her VP of Strategy after she took over the Brand Group a couple of years ago. I learned a tremendous amount from her, and I suspect that everyone who has ever had the chance to work for Susan feels as I fortunate as I do to have had someone as thoughtful and considerate as their boss.

During my first few months back at AOL I pestered Susan (and anyone else who'd listen to me) about the need to shake up the way the company did product development. It was Luke Beatty who actually stuck his neck out to make this happen. He worked to bring Alpha, our experimental product group, to life, and then gave us the organizational cover to do our thing with a minimal amount of corporate interference. Luke is the real deal and I appreciate everything he's done both me for me and for Alpha. 

Leaving AOL also means that for the first time in many years I won't be working alongside Ryan Block, my long-time collaborator, gdgt co-founder, and Alpha co-director. Ryan was instrumental in Engadget's success, and helping to build first that site, and then later gdgt, was a real privilege. I'm honored to call him my best friend and I'm going to miss building new things with him. The good news is that we are going to continue doing MVP, our podcast, so we will be able to continue our collaboration in one small way. And now that I'm in San Francisco we'll be able to record that in person. 

AOL has been good to me. There were a lot of insanely frustrating moments, I'm not going to lie, but it says a lot that they actually gave Ryan and me the resources to go build stuff and then pretty much left us alone. I met a ton of great people over these past few years and I'll say that the AOL I rejoined in 2013 felt like a completely different -- and better -- place than the AOL I left in 2008. Altogether I've spent a good chunk of my career here and it's hard to be anything but grateful.

Crowdfunding and the Counterintuitive Value of Constraints

by Peter Rojas

I was chatting with Josh Guttman from SoftBank Capital the other day about crowdfunded hardware projects and whether or not a successful campaign made him more likely to invest in a company, as it would presumably provide early validation for product/market fit. His opinion was that there's minimal correlation between running a successful crowdfunding campaign and building a successful business. This may surprise some people since lately investors have been pouring money into companies which have used Kickstarter or Indiegogo to launch new products.

Read More

Moving (back) to San Francisco

by Peter Rojas

After fourteen years in New York, I'm moving back to San Francisco. There was a point not too long ago when I expected I'd live in New York for more or less the rest of my life. I've loved living here and I'm not leaving because I'm tired of the city or feel like it's changed for the worse over the time I've been here. 

Read More