|Mahalo Cuts Headcount by 10pct After Google Algo Change|
Mahalo Cuts Headcount by 10pct After Google Algo Change [centernetworks.com]
I feel for Mahalo founder and CEO Jason Calacanis this past week. He finishes his Launch conference (my recap), heads to the afterparty and probably gets 10,000 text messages because that was just about the time that Google announced their algorithm change. Assuming Jason wasn’t briefed by Google about the change, that really is pretty horrible timing and I wouldn’t wish that on anyone, even a guy from the B-line (I am D-line).
This afternoon Jason and Mahalo president Jason Rapp sent out a mass email noting that, based on the Google changes, they will be reducing Mahalo staff headcount immediately by 10%.
(re: the google change) Despite those efforts, unfortunately, the Google changes have led to a
significant dip in our traffic and revenue. It’s hard not to be disappointed since we’ve been spending millions of
dollars on producing highly professional content.
Today we have eliminated a handful of positions in the company (about 10%), and we’ve cut a number of non-essential services we provide internally. In addition, we are re-evaluating our freelance content
production, pausing it in the near term and determining how to best produce the high-quality educational material we aspire to in the long run. We are not, however, diminishing our video production efforts.
I guess they missed the linked threads:
Depending on Google has hurt businesses since at least 2002 [webmasterworld.com]
How many business are there (even large) who depend on Google to stay in business?
I think one take-away from this change and situation for the webmaster is: If fairly large businesses can't (shouldn't) rely on Google for their business, it probably stands to reason you Definitely Shouldn't.
Let me rephrase: You probably don't have the resources or traffic of some of the large companies struggling because of the change, so it seems to be Really Poor Planning for the independent webmaster to even think about basing their future and livelihood on Google alone.
I'm not saying to stop building sites, but I'm definitely saying Diversify Traffic Sources and be smart about it. Run it like a business, not a website or don't depend on it for a living, and learn from the mistakes others have made.
|I feel for Mahalo founder and CEO Jason Calacanis this past week... |
They hot link my images (through google images) so I can't block them without blocking google images.
I think the point of the story is that people lose their jobs over a Google update.
Some might argue that there's a the angle of social responsibility whenver google makes a change.
|I feel for Mahalo founder and CEO Jason Calacanis this past week |
I don't. He is hotlinking my images, which is in a way content theft.
|I think the point of the story is that people lose their jobs over a Google update. |
Fair enough. But the responsibility was really on the executives of Macrapo not to have such a bad product. If they had good a GOOD quality product in the first place, they wouldn't be in the position they are in now.
Further, no one FORCED Macrapo to become dependent on placement in google's listings for their business. No one put a gun to their heads. They chose to do so knowing that google could change their algorithm at any moment.
Live by the sword, die by the sword.
|Some might argue that there's a the angle of social responsibility whenver google makes a change. |
And what about shareholder responsibility?
As for social responsibility, think of it this way:
There use to be an embargo against products from South Africa due to Apartheid. US Steel manufactures were able to compete because south African steel (which was cheaper) was not available to the US market.
Well, the embargo ended and the influx of South African steel killed off the remaining steel industry in the US.
So, should we have kept the embargo against south Africa in place out of "social responsibility" for the American workers who lost their jobs?
To be honest I don't see this as a big deal.
I mean, of course I feel for those who have lost their job.
But industries change, economies change, big players and big companies change ("The one constant in the Universe is change; the wise adapt" - a Warhammer 40k quote!).
In this case, a big player on the internet have made a big change, which will result in some job losses and some job gains (since I assume any big sites which see fairly good gains will be hiring..).
|So, should we have kept the embargo against south Africa in place out of "social responsibility" for the American workers who lost their jobs? |
Sometimes it makes sense to protect domestic industry, other times it doesn't. It might actually be a good thing for the health of the US economy to have a steel manufacturing industry.
But that's not the point. This has nothing to do with national economies, it's just that some people gained and others lost. That is an inevitable consequence of the dynamic nature of the universe, and should not in itself be cause for alarm.
There should be a general disclaimer that applies whenever someone argues that a change should not be made because it will reduce their ability to make money by doing what they are doing now. The fact that you are currently making money by doing something doesn't mean that it's necessarily a good thing to do, nor does it mean that you have a right to continue making money by doing it.
People always make the same sort of argument about environmental issues: we can't change anything, we can't stop polluting, because we'll lose jobs. I say so what? Those jobs may have been doing things that should not be done in the first place. If your job is cutting down trees or writing crappy content for a content farm, maybe you should find another line of work.
Now, you can argue in particular cases about whether the content was actually crappy, that's fine. My point is that just the fact that a change caused job losses in some companies does not make that change socially irresponsible. The economy might be better off with those people working on doing something else. You have to consider the health of the whole system.
This is different, Mahalo's business plan was to cheat Google with useless 'content'
So the change happened just a few days ago. No-one knows yet how Google coded this - it could turn out to be easy to fix up. They are spending "millions on advertising" and yet they are happy to put 10% of their staff out of work immediately?
There must be more to it. I reckon they wanted to make cuts and this just gave them the perfect excuse.
|I reckon they wanted to make cuts and this just gave them the perfect excuse. |
It's just business, everyone but the boss and his bank account are expendable.
I never saw this site before tonight. I'd say this was another score for Google, given the content I was looking over. I'd also question someone's leadership abilities when they make a move like this... Redouble efforts, figure out how to win in the new environment. Throw in the towel?
Put some butter on Mahalo, they're toast.