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There was a time when Google released its Desktop Search application (since renamed Google Desktop), and the Google Talk client more or less together. Back then, I wondered why Google was going down the path of Windows desktop applications – wasn’t the Web the Future, according to them? I did think that their strategy implementation was faltering just a bit.

In any case, this month we’ve seen an example of what the next generation of web applications is going to look like. Google Talk is no longer an “application”, but a Flash “gadget” that can live anywhere on the web – be it on your personalized Google homepage, or your blog, or your Firefox sidebar. Well, a web-based chat application is rather stale – computer science undergrads routinely write applications like these as part of their network programming course. But the Talk Gadget’s different – in two significant ways:

One, it’s got about all the functionality of a desktop application. Because it’s Flash-based (as opposed to HTML/AJAX), it’s able to incorporate features like tabbed chats, Flickr/Picasa slideshows, or embedded YouTube videos.

Two, it can be “deployed” anywhere on the web, as I mentioned earlier. This has far-reaching consequences for web application developers; the Talk Gadget represents the beginning of the era of full-featured application components, an era where you no longer have to download/launch/upgrade applications, or even live with browser-based implementations. We’ve set foot into the realm of “instant launch”. Take a look at the Google Talk page if you don’t get what I just said. The big blue button no longer says “Download Google Talk” – just “Launch Google Talk”.

I guess we can see where we’re going – “launch Word/Excel/PowerPoint” anytime, anywhere, for starters. Componentization of full-featured applications like this could lead to completely new ways of looking at existing web applications. Take Blogger. Today, the publisher and the reader have very different interfaces to the blog – the publisher uses the Blogger interface to compose, manage and publish posts, and the user views the *.blogspot.com pages. With Word processor integration, we could have a collapsible compose window right at the top, viewable only by the publisher. He/she could compose/manage posts right from the existing *.blogspot.com page. And what is a comments system but a multi-way chat? Enter the embedded Google Talk Gadget. Adding images is no longer cumbersome – simply drag and drop from your desktop (or browser window) into the compose area, and it’s automatically uploaded or linked. Let your imagination loose for email and scheduling applications too. Now embed AdSense into these components, and you can see where the money’s coming from.

Finally, the most promising platform to deliver these applications seems to be Flash. Suddenly, Adobe has been given a new lease of life. Will Google risk building its future application services on a platform owned by another company? And where does Adobe go from here? (Think Apollo.) That’s fodder for another post!

Any good affiliate marketer hits the Long Tail Dilemma of publishers fairly quickly. On the one hand are large publishers with lots of eyeballs which could get the merchant huge volumes of highly focused audiences. For instance, an India-centric Moto-enthusiast website such as http://www.xbhp.com/ would make a fantastic publisher for a motorcycle company such as Royal Enfield. These form the “head” of your publisher base – they number a few, but bring in substantial sale volumes individually. As an affiliate program manager, you will work with each individual large publisher to best position your merchant’s offerings on their web “real estate”.

Here’s where you get real innovation, where magic with data feeds can be wrought, where true integration with content is possible.However, affiliate program managers are also acutely aware that there’s tons of data being generated every single day on the web – and that every website, blog, service that comes online is more web real estate, and every new user is a potential affiliate. These form the “tail” of your publisher base. For an affiliate program to really scale (and scale tremendously), it must ride the wave of this data. As a program manager, you won’t chase and cut deals with each individual fish that jumps into the web pool. Today, you rely on publisher registrations on CJ, Shareasale, Linkshare and that minnow in the news lately, Performics. As the read-write web gathers mass, the tail is growing inexorably larger in comparison to the head.

The Dilemma, then, is this: you can’t offer the tail as much as you can offer the head. And reciprocally, the tail can’t perform acrobatics with your creatives and data feeds either. All your tail does today is slap banner or text ads on their blogs or home pages. That’s about the limit of adoption. Where’s the differentiation? Not only for your merchant, but also for you, the affiliate program manager? What value are you adding? If the only interaction with the tail is going to be making animated GIFs and catchy text ads, writing up a “Join our Affiliate Program” page on the merchant’s website, and registering on CJ et al (and waiting for the tail to sign up), the merchant will soon realize that the middleman isn’t adding any value, and will cut you out. He’d much rather do it himself.

What we’re seeing is the commoditization of the process of traditional affiliate marketing. The guys who’ll make the real bucks in the future are going to be those who’ll put easy-to-use tools in the hands of the tail. Or even better, make tools for affiliates that auto-deploy themselves. Who bring in the innovation that belongs in the head today into the tail. Amazon began the process way back with aStore, but that isn’t going far enough.

Hold it. Auto-deploy? Doesn’t that sound like Search Engine Marketing? Well, it does, in a way. From the publisher’s point of view, what’s the essential difference between AdSense and Affiliate marketing? With AdSense, the publisher has no control over what ads will be displayed in the AdSense code box that he/she slaps on his/her page, merely that they’ll be more or less relevant to the page content. With Affiliate marketing, the publisher chooses from a clutch of creatives provided by a merchant. Once you talk about auto-deploying merchant creatives in innovative, “head-like” ways, the line between them gets blurred. Several startups have caught on already. This comment on Sam Harrelson’s blog lists a few of the more interesting ones.

We’re at a fairly interesting juncture in the Affiliate Marketing market. The next big opportunity belongs to whoever will have the gumption to target the Long Tail, and do it in a way that goes far beyond the tired, banal banner-text-ad process that’s been perfected into a science.

Now that enough and more has been written and discussed about the DoubleClick deal, it’s time to take a peek into the past, near the end of 1999. From John Battelle’s book “The Search”:

“There was always the fallback of simply running banners on Google’s prodigious traffic – one deal with DoubleClick, an ad network that specialized in serving graphical banners, would probably net the company millions of dollars. But that felt like a sellout – DoubleClick’s ads were often gaudy and irrelevant. They represented everything Page and Brin felt was wrong with the Internet. “They didn’t want to turn the Web site into the online version of Forty-second Street,” recalls investor and director Michael Moritz.

So Google’s decided to take the plunge and buy DoubleClick. And what’s more, along with the big bird, they also get Performics as part of the deal. Performics was a bit player in the affiliate marketing space until yesterday, but under the Google umbrella it transforms into a potential 800-pound gorilla. Understandably, the affiliate marketing corner of the blogosphere’s gone ballistic over it. Every affiliate consultant worth his/her salt has a take on it. There are two things which everyone seems to have missed. The less significant one first:

1.) Google doesn’t seem too enthusiastic about Performics. From the takeover FAQ:

Q. What will Google do with Performics?
A. Performics is part of DoubleClick, and we are acquiring it as part of the transaction. We have no plans to dispose of it at this time.

Dispose of it? Haven’t they any idea what they’re going to do with it? Or is this a subtle attempt to throw potential competitors off the track?

2.) Here’s the big one, though, and I’m surprised no one’s caught on to it: Late last month, Google announced a US-only, beta program for what it calls “pay-per-action” advertising which, from this page, looks like affiliate marketing masquerading under a Google-ized pseudonym. Take the very first question, for instance:

What is pay-per-action advertising?
Pay-per-action advertising is a new pricing model that allows advertisers to pay only when specific actions that they define are completed by a user on their site. Rather than paying for clicks or impressions, advertisers can choose to pay when a user makes a purchase, signs up for a newsletter, or completes any other clearly defined action that they choose. Pay-per-action ads are eligible to appear on publisher sites in the Google content network, and publishers can choose specific pay-per-action ads that are relevant to their site to run in new ad units that they create.

There you go. My take on it is that Performics technology is far more important to Google’s strategy than they’re letting on. With Performics as a complement to its pay-per-action efforts, the company acquires a ready seed base of merchants and publishers (although insignificant in comparison to giants like Commission Junction and ShareASale.com). Expect more innovations from the Goog’s stable, perhaps on the lines of the superbly-executed Amazon Affiliate Program, or even beyond.

One of the more interesting applications of Google Trends is to compare the search volumes of two or more search terms over the past several months (or years). So we were winding down work yesterday at Convonix, and fooling around with Google trends, when, on a whim, I compared “valentine” and “lingerie”. And well – there is a correlation. See for yourself.