NETWORK WORLD NEWSLETTER: MARK GIBBS ON WEB APPLICATIONS
08/16/04
Today's focus:  The value of vertical search

Dear [EMAIL PROTECTED],

In this issue:

* Calculating the cost advantages of using vertical search 
��engines
* Links related to Web Applications
* Featured reader resource
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Today's focus:  The value of vertical search

By Mark Gibbs

A few weeks ago, I discussed vertical search engines - search 
engines that address a well-defined vertical market (a narrow 
topic with deep content) as opposed to, say, Google's horizontal 
market approach (the broadest possible range of topics with a 
shallow reach). The intention of vertical search engines is to 
add value by increasing the value of the search. 

So what are the business models for vertical search engines? The 
key issue is who pays and there are three ways a vertical search 
engine can be monetized:

1. Listed sites pay. 
2. The subscribers pay. 
3. Advertisers pay.

The ideal formula would be to exploit all three revenue streams 
but whether that can be done depends on the nature of the 
content and the consumer of the service.

Consider, for example, a product from EDC called Legal Advantage 
(see editorial links below). This is a vertical search engine 
that "provides lawyers with client-oriented information 
specifically tailored to the way individual lawyers work."

The cost is born by subscribers and due to the nature of the 
content and the users, subscriptions are EDC's sole revenue 
stream. The reason that Legal Advantage is likely to be very 
successful is that it provides a single point of service that 
has been traditionally delivered through multiple industry 
services such as Westlaw, LexisNexis, and generic search engines 
such as Google.

Legal Advantage essentially brokers data from other sources and 
adds no human editorial processes other than those applied by 
their external suppliers such as Reuters. The focus is the 
tracking of one client's data - share prices, public financial 
statements, press releases, competitive market data, and so on - 
essentially a dynamic, in-depth profile of a company.

Now, as I pointed out earlier, the intention of vertical search 
engines is to add value by increasing the value of the search 
process, so rather than a horizontal search providing 900 hits 
with a 10% relevancy a vertical search a service such as Legal 
Advantage might return 100 hits with a 90% relevancy.

If examining a hit to determine its relevancy takes 30 seconds 
then 900 hits from a horizontal search engine will take 7.5 
hours as opposed to analyzing 100 hits from a vertical search 
engine, which will require just 50 minutes. In both cases, we 
wind up with the same number of relevant results (90).

Now if the user is, say, a lawyer who charges $300 per hour then 
the horizontal search will cost $2,250 for the lawyer to go 
through the hits, while the vertical search would cost just 
$250. Add to that that Legal Advantage claims to cost about 
one-third the price of subscriptions to multiple databases to 
search the same range of materials and you can see a very 
powerful argument for industry or task specific vertical search 
engines.

RELATED EDITORIAL LINKS

Vertical search engines and what Google can't do
Network World Web Applications Newsletter, 07/19/04
http://www.nwfusion.com/newsletters/web/2004/0719web1.html

Legal Advantage
http://edc-advantage.com/

LexisNexis
http://www.lexisnexis.com/

Westlaw
http://www.westlaw.com/

Windows users put on defensive by SP2
Network World, 08/16/04
http://www.nwfusion.com/news/2004/081604xpsp.html

Companies play nice in front of W3C
Network World, 08/16/04
http://www.nwfusion.com/news/2004/081604standards.html
_______________________________________________________________
To contact: Mark Gibbs

Mark Gibbs is a consultant, author, journalist, and columnist 
and he writes the weekly Backspin and Gearhead columns in 
Network World. We'll spare you the rest of the bio but if you 
want to know more, go to <http://www.gibbs.com/mgbio>. Contact 
him at <mailto:[EMAIL PROTECTED]> 
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ARCHIVE LINKS

Archive of the Web Applications newsletter:
http://www.nwfusion.com/newsletters/web/index.html
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