Making Up Stuff About Yahoo Fire Eagle

Yahoo announced the arrival of its FireEagle location brokering product last Wednesday. What the heck is it you may ask? Well, straight from the source… according to Yahoo it “is the secure and stylish way to share your location with sites and services online. We want to make the whole web respond to where you are, and to help you discover more about the world around you.”

Ok. Well to start from the beginning. Yahoo wants to be the broker for your online location information. So what does that mean exactly? Well just like other types of brokers: stock broker, real estate broker, mortgage broker, and insurance brokers…. They want to help mediate the exchange between a buyer and seller of something of value. In this case, the thing of value is information related to where you are on this lovely planet.

So to be clear, there is currently no money directly exchanging hands and so far, the broker is doing his brokering for free.

So let’s think about why someone would want to buy and sell such a thing and why Yahoo would want to step into become the broker. So what do the buyer and seller in this brokerage relationship get out of it?

Buyers (websites, application developers) get relatively turnkey access to better information that makes their service more convenient and valuable. Nearly everyone who offers an online or mobile application would like to be able to easily know and use their customers’ location and integrate it into the features of the application. Granted it’s more important to some than others, but the need is widespread across a variety of applications for anything from letting you know the weather forecast or showing only relevant apartment listings, or showing pages in the correct local language. Heck if local governments takes a fancy to this, you might see them trying to collect different taxes based on where the user was when a transaction was consummated. Woo Hoo! Don’t worry, that ain’t happening anytime soon.

Sellers, (ie you the consumer), get the convenience of not having to explicitly tell every site or application you come across, your location information and you get to decide what to share or not share each time. Remember the eWallet phenomenon from the late ‘90s? The eWallet was going to save everyone the hassle of having to re enter their personal and financial information and the eWallet was the gatekeeper to your wallet online. In many ways Fire Eagle is a cross between the location equivalent of the eWallet and a cross site/device “smart cookie” that knows and holds your location information and just shares the detail that you want shared and only with “approved” sites.

Last but not least, assuming it’s not out of pure benevolence, what does Yahoo get out of this whole thing?

Well the answer is probably not that simple and straightforward, but I’ll hazard a point of view on where you could take this: Yahoo’s business is primarily selling advertising. And forget about amassing more and more page views as a strategy, the absolutely massive supply of potential impressions on the web means that only a very small fraction of those impressions ever get monetized. Instead, the name of the game is to have the high valued stuff that advertisers want.

So the next logical question is, well what kind of stuff do advertisers want? Well it can generally be broken into two parts…

1. Mass concentration of eyeballs in a single place. Think of the price premium advertisers place on an ad on a hot primetime program versus the equivalent number of eyeballs pieced together from running 100 spots at 3am

2. Targeting. The degree of match or correlation between the advertisers product and the reason the online impression was generated… ie there are billions of page views being generate out there on arcane scientific matters, oceanic current, Chinese consumer electronic company balance sheets, etc, etc that advertisers want absolutely nothing to do with

So here are some leading businesses who make their money from online advertising, and the stuff they provide that advertisers want:

• Google: just amazingly good at targeting/filtering, effective revenue per thousand is off the charts relative to anyone else. They could directly monetize the mass concentration aspect as well, but so far have chosen not to.

• Yahoo: both large aggregator of eyeballs for premium display ad business and also big player in search

• AOL: was once the largest aggregator of all Internet eyeballs, but is now forced to be an aggregator of large broad verticals of consumer friendly eyeballs (family, finance, entertainment type stuff). They also leverage their size by double-dipping and renting targeted search from Google.

So going back to Fire Eagle. By knowing people’s location information and matching that information with knowable information about the world around those people, the opportunity exists to target like never before. To date, targeting has been one dimensional from the point of view that it has been limited to indexing information from web pages and only reflects the view as seen from the time a user spends in front of a web browser.

If you look at how quickly mobile location awareness technology is proliferating into everyday consumer devices like cell phones, there is no reason to expect that everything that is currently done in the world of web based targeting won’t be stretched, linked and recreated into the ‘real world’ with mobile location aware devices at the foundation.

Let’s take a look at the way a few things work in the web world and see how they may translated into the mobile location awareness world:

Everything from PageRank to click through rates and behavioral targeting, could be recreated, through a widely available mass market location awareness program. So in theory this could be the foundation of what FireEagle is all about.

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Where r u?

There is an interesting piece on myLoki (Skyhook Wireless) and location information brokering by Brady Forrest on the O’Reilly Radar Blog, about how services are developing to give people more control over how, if and when they share their location with others. Just for fun, I went ahead and signed up for the myLoki account and added the location badge to the homepage of the blog… so if you ever need to know where I… err well where my computer is… chances are the map will give you a good idea of where to start looking… unless of course I stop piggy backing on my neighbors wi fi connection and connect through the corporate network, in which case you’ll likely think I am in Pennsylvania somewhere.

Besides Loki, the author cites a soon to be released developmental project, currently called Fire Eagle, out of the Yahoo idea incubator called Brickhouse as something to watch for in the area of location info brokering.

Details on the Fire Eagle project are scarce, well at least scarce to me, but the best details seem to be directly from Yahoo itself. In the most simple terms, the service allows you to share the location information your collect on yourself, either from a web service or mobile device, with other services and applications that you so choose.

In a way it acts as a clearing house to give control to users who want to share information about their whereabouts with others. It will allow a user to manage the level of location granularity different recipients will be able to see and manage different types of location information, including anything from GPS long/lat data, to Cell ID or manually entered postal code information.

You know how you have to always enter your zip code to do anything from looking at movie listings to seeing what the weather will be tomorrow? Well a system like Fire Eagle at the most basic level could roughly be like having a pervasive cookie that could be read by all sites which could contain your zip code information to share with each site that may request it, eliminating the annoying need for you to re enter that information manually each time you wanted location relevant information.

My guess is that this is the type of baby steps that a solution like Fire Eagle will initially be used for, but the potential is there to do much more powerful things, and could well be an important conduit of such information in the near future which could allow innovative LBS application developers to make a large leap forward.

The general concept of trying to act as this middle man is of course nothing new in these types of online exchanges. I am sure many will recall all the hype around the eWallets that were pervasive in the late 90s. Folks like Microsoft wanted to be your virtual wallet, streamlining and managing the process of giving personal and banking information to the various folks you may want to interact with on the web. In case you didn’t notice, eWallets aren’t pervasive now.

However I wouldn’t be so quick to assume the same fate for services like Fire Eagle for a couple of reasons. First I don’t see people being as paranoid about location as they are about their bank account information, especially given the proper tools for control. Second, the eWallet purely saved you a couple of steps of entering information into an online form manually, so it just saved you some headaches. Sharing location information, however can allow entirely new innovative services to be delivered…. know when friends are nearby, know when a sales is happening nearby, know where your loved ones are, search for anything in your immediate proximity, etc.

Once folks see the value that can be created through location awareness and sharing location awareness they’ll be more likely to gravitate to such a service because of the myriad of benefits they’ll expect to receive in return.

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