The media has been talking about real-time search a lot lately saying it’ll be a huge market opportunity, others going so far as to say it’ll overtake organic search as we know it today… Call me a naysayer. I’ve been predicting social media’s collapse for awhile now and have been very vocal to people I know, saying it’s one big bubble — so what do I know anyway right?

The thing with real-time search is that you’re never going to be able to prevent spam. Sure you can block results containing certain words or company names just like a blog spam filter does today, however how are you ever going to block companies tweeting (or using another service other than Twitter in the future) to microblog about themselves? There are search engine optimization strategies used by many companies to “clean” results up — basically, rank higher in the SERPs with good information about the company than critical information. Getting critical information under the first page fold means most customers aren’t going to see it. The nice thing about the progress search engines have made over the years is that they use so many variables in calculating rankings today, you’re not going to be able to outrank information just because you want to in many cases. How are you going to organize real-time search results? Are you going to list the results which have been written the most recently — as in a company could have 10 people sit at their computers and microblog good things about their company to dominate the rankings all day?

I’m sure that’s far more simplistic than reality will be, however I ask myself this — how often when I’m doing searches do I want to know what happened this very second? This isn’t hard to think of in a scientific manner.. Find a list of the keywords most searched on search engines and think about whether they’d be time- sensitive or not. If I search for “sports scores”, yeah I probably want recent information but if I search for “wood bats”, I probably don’t.

For those who don’t know, Google has a couple services themselves which while not real time are pretty close to it. The first one, Google News, delivers news from strictly reputable websites. If you type “domain” into Google, it will return all articles which have “domain” in their title from websites which have been approved by Google News. For information on domains, you’ll find Domain Name Wire in there, as well as Domain Informer and CircleID. You can do on Google News and find every single article published by Domain Name Wire in the past day, week, month, or even hour by typing: source:domain_name_wire. How much quicker do you need your domain information than that?

The nice thing about Google News is that junk isn’t allowed in there. You’re not going to find any blogs by domain newbies and you won’t even find a blog like mine in there because it’s too much opinion and not enough fact. When you’re looking for information, you generally want facts, not how someone thinks it does or should works. But what if you’d like to know people’s opinions? There’s Google Blog Search for that. Google’s Blog Search is remarkably comprehensive — just a quick look at it search for “domain” once again and you’ll find this blog, Domain Name Wire, eBusinessDomains. You can get more specific and type in say, “domain auction” and you’ll get even more relevant results and once again, more topics covering that within the past day, week, month, hour.

So what’s all this hype about real-time search? In my opinion, it’s largely unwarranted. As a niche, sure. But Google’s gotten good enough in many cases that you’ll already get what you’re looking for between it’s organic search and it’s blog search, on top of having a credible news site (Google News) which you can count on to provide accurate information — how the heck are you going to guarantee that with real time searches unless you carefully select who you allow in your search results? And if you’re going to do that, isn’t it largely going to eliminate the whole benefit of real time search and essentially make it a Google News copycat that maybe gets the information 1 hour sooner? If the people decide 1 hour is too long to wait, I’d imagine Google could trim that time to 30 minutes or even 15 minutes relatively easily with the technology they’re already using and a few more data centers to process all that extra server load.

Personally, I’ll take that 1 hour wait and get the information from a site I know and trust — how about you? And if I’m not looking for time-sensitive information, why the heck would I use a new real-time search engine over industry experts like Google and Yahoo who’ve had years to refine their search engine algorithms to deliver as accurate of results as is currently possible with today’s search engine technology?

Real-time search.. Meh. Reminds me of the hype surrounding WebTV. Probably not the popular opinion, however I see most of Web 2.0 as being a lot of fluff and not a whole lot of substance. I’ve been calling Facebook overpriced since the day analysts were tossing around a $15B valuation based on a single stake in the company being purchased by Microsoft which any idiot (aka market analyst) would have realized was for not only a 2% stake in the company but also the right to sell third party advertisements. I haven’t been following it too much since as I think the whole thing’s a joke, however I believe it’s now “valued” at $4B.

To put a domaining analogy on it, most of these social networks are like LLLL.coms — they produce minimal revenue and have a whole lot of annual costs. There’s nothing wrong with having a few but would you make a whole domain portfolio out of them? We’ve seen Myspace go from being a respectable website to a site dominated by teenage girls and spam in a span of what - 2 years? We all know how quickly things change on the Internet. In a lot of ways, social media is like domaining — there is very little transparency. Sure Twitter can throw around numbers like 10 million accounts, it’s just to bad that a recent random sample conducted on over 300,000 Twitter users by the Harvard Business School suggests 10% of Twitter users do 90% of the tweeting and and internet marketing firm Hubspot noted that 55% of Twitter users have never posted a single tweet and 56% have never followed anyone. Keep in mind that if they posted just 1 tweet in the last year, they don’t fall into this statistic. Maybe that’s why Twitter says the number of accounts rather than the number of active users — reality ain’t so rosy now is it? The attrition rate on social media (and especially Twitter) is ridiculously high, yet these companies are getting valued based on how many users they have rather than how many active users they have — the only statistic that actually matters. If someone signed up in early 2008 and hasn’t used the social network since, what’s the probability they return in the future?

It goes back to that debate of targeted traffic versus untargeted traffic. The offline world still hasn’t understood that what has value is targeted traffic, not untargeted traffic. If your social network business model revolves around selling users products or serving up advertisements, then you’re making nothing off of users who don’t sign into their account at least from time to time. When you have far more inactive users than active ones, you best look at what you’re doing wrong. According to Compete.com, Twitter’s enormous gains came to a complete standstill in May and had been looking like it would in April as well until receiving a mention on Oprah.

Don’t get me wrong — I use Twitter myself and have nothing against these social networks. It’s just these preposterous valuations that seem as ridiculous as those made a decade ago. Those who do not learn from history are doomed to repeat it. Wall Street’s forgotten about this recession and is already lobbying government for an unregulated carbon derivatives market. Who wants to predict the outcome of that one?

Related posts:

1. Social Media’s Effect on Search Engines
2. Real-Time Search
3. Free 2.0