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Privatization is the shifting of government functions into the private sector. Privatization is also the transfer of public assets into private corporations. This started in 1980. Today there is evidence suggesting that privatization has led to systemic government shutdowns and other negative unintended consequences including serious damage to the industrial base, colleges, universities, air transportation, the FAA, and the citizens of the United States. More Information and Buy

Associate Programs / Micro Transaction

Introduction

Remember your logging features? The server is able to determine where you came from, the previous URL. Basically the Internet can be used to track a visitor to a final destination site. This feature has been used to create a thing called an associate program. Associate programs were invented by Amazon.com. Micro-transactions were coined a few years ago and were identified as the approach to provide revenue to major portals, such as Yahoo.

The problem with a micro transaction is that the source site is unable to verify if the transaction has successfully completed. You are reliant on the HONESTY of the destination site. Our data shows that Amazon.com is honest. So is FogDog.com. Our personal data also suggests that DOT COMs who have recently failed were not paying their associates. During the past 18 months we have systematically thrown off vendors from our site that have been shown to be less than honest. Our evidence is circumstantial and based entirely on our logging system and analysis tools. A class action lawsuit in most cases is not practical since the entities are desolving (corporate bankruptcies).

A transaction is not a transaction unless there is an end to end acknowledgement. There is room here for significant growth and repair.

Amazon Patents

1. 6,144,958 System and method for correcting spelling errors in search queries
2. 6,064,980 System and methods for collaborative recommendations
3. 6,029,141 Internet-based customer referral system
4. 6,006,225 Refining search queries by the suggestion of correlated terms from prior searches
5. 6,003,024 System and method for selecting rows from dimensional databases
6. 5,999,924 Method and apparatus for producing sequenced queries
7. 5,963,949 Method for data gathering around forms and search barriers
8. 5,960,411 Method and system for placing a purchase order via a communications network
9. 5,727,163 Secure method for communicating credit card data when placing an order on a non-secure network
10. 5,715,399 Secure method and system for communicating a list of credit card numbers over a non-secure network

Associate Programs

AmazonAssociates
AssociatePrograms.com
AffiliatePrograms.com

Other Approaches To The Micro Transaction

LinkShare
BeeFree
CommissionJunctions

Internet Denial of Service Attacks

Our original ISP, waterwheel systems experienced hacking which resulted in 3 denial of service attacks. The first was in October of 1998, not shown in the graph, and the second and third occurred in first quarter of 1999. Shortly after the last attack waterwheel systems sold its operations to Magpage, a company currently engaged in buying small ISPs. After the last attack waterwheel systems was offline for almost 2 weeks. These were extremely capable people and outages would rarely exceed 20 minutes.

The above data is smoothed with a 7 day low pass filter. The actual attacks were in the 6,000 to 10,000 range. Notice that the adjusted value which is a factor of the orders was not altered indicating that the Amazon order tracking system is reasonable.

Banner Advertising

In 1998 we determined that banner advertising does not work. People will not click on ads outside the particular theme that they are currently investigating. However, in 2000 we ran more sophisticated experiments and determined that Ads significantly affect sales. The experiment included running no ads, internally created ads, and ads from traditional copywriters and artists for products such as music, videos, and books. Our ads reduced sales instantly once compared to no ads. Ads produced by professional copywriters and artists instantly increased sales once compared to no ads. In fact, there was no correlation to the ads and the final sales categories. They were theme independent. A nice set of ads associated with music would increase sales in tools or cooking. We concluded that Professional Copywriters and Artists know their stuff and place the consumer in a mood to purchase something, anything. The only characteristic in ads that we noticed is the use of pastel colors.

This is Not TV or Radio

The number of transmitters that were technically possible limited the TV and Radio to a select number of transmitters. This gave birth to the FCC early in the century. The result was the creation of oligopolies with huge economies of scale that could translate to name recognition - ABS, CBS, and NBC. People could remember the small number of players. The Internet is different. There are millions of transmitters (web pages) on the Internet. People will not type in www.abc.com, www.xyz.com or www.amazon.com. Nor will people bookmark the entire universe. They will access a search engine to find what they want. Search engines are critical to an e-commerce solution. Whoever established the ground rules for the Internet and the rules of the search engines was a genius. These simple rules make millions of transmitters possible today.

Amazon.com Invented Something Great

As everyone tries to apply the paradigms of traditional media techniques to the web, Amazon.com has invented the associate program. This is not advertising. Amazon.com started with 25,000 associates in 1Q98 and currently (1998) has 150,000 associates some of who have content on their web sites that represent Amazon.com products. With the associate program, amazon.com has multiplied the effective reach from the search engine perspective to the equivalent of 150,000 sites. In return these sites get from 5% to 15% commission. Cassbeth.com delivered over $10,000 worth of business to amazon.com in 98. If cassbeth.com is a typical good associate (i.e. top 20%), then the associates delivered 150,000*.2*10,000 = $300 million in 1998 sales. 1999 will be the year of associate programs on the Internet. Further, it probably will be the year of the demise for the application of traditional media techniques on the web. Again, this is not TV, radio, or print media.

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Welcome to another year of cyber shopping at earthlingsunited. We organize and humanize access to shopping on the entire web, like no other portal on the web. Please don't forget to tell your friends about our special place. Thanks and enjoy your visit.

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