The high point of today was a trip to Yahoo’s Brickhouse research facility in the tech quarter of San Francisco. Chad Dickerson – the guy who organizes the famous hack days -gave us the run down. The facility was set up to allow an innovative culture to thrive away from the glare of corporate HQ. The thing you notice is the informal atmosphere – big open free form warehouse space with table tennis tables etc. The startlng thing though is what has been achieved. Yahoo Live was coded here by a team of six. Fire Eagle was also conceived here – again by a team ot six. We met Tom Coates the team lead. This bit of Yahoo at least doesn’t look like a company under threat of takeover by Microsoft. It looks likes nimble, innovative idea generation factory.

West Shell, ceo of Healthline, is now talking. He has taken the company during the last three years from 5 people to 80 people. Now it is the leading provider of health information in US he says and soon to be the world.

Healthline Networks develops services which it first tries out on Healthline.com which is one of the top sites in the US with 27m impressions and 6m uniques in February. He says the market is changing fast – the ageing population is driving the market. 80% of all elderly Americans went online last year looking for health advice, he says.

Medical search is a complex area basically since consumer and medical language don’t match. The core asset is the world’s largest medical taxonomy.

Next they are planning to add advertising, again driven by the taxonomy.

WebMD has 18% of the market on its own, but because the Healthline platform is distributed through partners it has already over 20% market share, says West.

Now they are working with health insurers (like Aetna) and medical suppliers (like GE) to provide customised and personal health information systems. These can be multi-million, multi-year deals.

Soundbites:

"These are not Barney deals ("I like you, you like me".) (talking about the partnership deals.)

Kathy Yates, ceo of AllBusiness.com is now talking. She shows us her LinkedIn page and her Facebook page and describes herself “west coast digerati”.

She says she first looked at Allbusiness in 2004. Her assessment? Good core audience of 200k users but with rudimentary publishing tools, and a notoriously difficult to reach segment – small business people. It had one thing going for it though: it was based in San Francisco.

She started in digital eight years ago as founder of Knight Ridder digital. Working at Dow Jones’ Marketwatch she began to consider whether search would become the strategic inflection point where Google provides enough information on the search page to obviate the need to visit sites like Marketwatch. That’s the point she joined AllBusiness.

Assumptions: we are living in an online world of intent-driven media; we are not long the front door, search is; readers care more about relevance than content source. The keys to success: it’s 10x more important to be agile than smart; economics of scale favours the aggregation model; and online businesses are quantitative and metrics driven.

They build a content management system which can auto-categorise aggregated content and a real time optimisation engine which can change content according to circumstances to maximise revenue. Content was built out – now there are 4m content units (licensed) in 25 types – words, video etc. There are relationships with over 800 vendors.

The audience is a broad based small business audience, very transactionally oriented, looking for solutions.

There is a lot of CPC lead generation advertising which is very targeted. They use the Fast search engine.

There are now 65 performance indicators which they track weekly. Interestingly – many of these are about spider activity.

“We analyse what sessions are being generated by each content unit and we then optimise to drive traffic up.” The key thing is the linkage into and out of each article – this is now what she describes as a science – she calls it the “blood supply”. However, the decision making around the data is very messy, she says. “The data only points you in the right direction.”

They are just about to introduce pay-per-document sales.

She says the original taxonomy wasn’t sophisticated enough, so now they license the taxonomy from Lexis-Nexis. There were 3.7m unique visitors in February and they are aiming for 5m at the end of the year. This compares with 1m uniques for the leading brand site entrepreneur.com

Only 3% of the audience comes in through the home page – search is key.

The company was bought by Dunn and Bradstreet in December last year.

So what is the next inflection?

Is it the end of advertising as we know it? Will the only thing that matters be mathematical algorithms which match users to advertising? Or will engaging user communities become key to unlocking brand advertising? She says she is just beginning to notice that brand advertisers are pulling back.

Soundbites:

“I have 300 contacts on LinkedIn.”

I missed this one. Apparently last September IBM’s Italian workers protested in Second Life about a recent pay deal. The protest focussed on the IBM business centre in Second Life and more than 1,850 people are said to have taken part.

Perhaps the weirdest twist, though, is that the protest went on to win an award for its contribution to web culture.