Examining Content Aggregators: Who Is Poised to Win?

Article ImageOutsell, Inc.'s release of "The Business Intelligence Landscape Today: The New Rules of Aggregation" in September shed some new light on where content aggregators are succeeding and where they need to change in order to meet evolving market needs.

"It's an era of fierce competition," says Ned May, vice president and lead analyst with Outsell and author of the report. "If you're not feeling like your information needs are being met, there are a lot of viable options that exist today." And, he adds, there is "no winner yet."

May notes in the report, however, that for all the change in the industry, "the underlying elements of what an aggregator exploits for value has not changed." Aggregators continue to engage with users in the discovery, distribution, and clearances phases of content consumption. What has changed is which stage creates the most "friction" or frustration for the end user. At the advent of online search, for example, the discovery phase was most difficult, and that problem was largely alleviated by Google.

But, as the report states, "Google's focus was never on business needs." And now, certain pain points have shifted as people look to niche providers to meet more focused needs. "The old rules of the market no longer apply. If you're not addressing a specific user group's specific needs, you're probably running into headwinds because there are others out there trying to do that," says May.

"It doesn't mean the opportunity is shrinking," he adds. If anything, this is creating a great deal of opportunity for both nimble, fledgling companies and more-established companies that are ready to explore partnerships and meet evolving user needs. May cites LinkedIn as one company exploring interesting partnership options.

One of the primary arenas that May sees room for growth and innovation in is curation, because the average internet search simply returns too many results. According to the Outsell report, between 2008 and 2011, "the number of respondents who indicated there was too much information to sift through rose from 9% to 30%." A Google search of "media monitoring service" returned 298,000 results; a search without the quotation marks returned 12.7 million-hardly a seamless way to conduct research.

"You need to be able to get business results that are relevant," says May. But he adds, "This is tough because it implies that there is someone actively vetting content. There are companies trying to do that algorithmically, such as FirstRain. I like what they are doing."

FirstRain targets the business user and aims to deliver a tailored set of results based on the authority of the source, the degree of duplication, the strength of the match, and a variety of other elements. Its platform can be integrated into a corporate intranet, and the FirstRain solution has been embedded into Salesforce.com; FactSet Research Systems, Inc.; and Capital IQ, among others.

This evolution is important today because "competition is broader than it may have been defined previously," says May. "The traditional aggregators eventually understood they are competing with Google, but now they are also competing with document delivery firms, subscriptions services firms, or small niche technology providers."

Beyond the friction in discovery and distribution, there continue to be pain points in the clearance phase, largely because it is now easier than ever to pass material along via social networks, email, and other delivery methods. Add to that the fact that only 47% of knowledge workers consider copyright before passing along information (per Outsell's research), and you have a space ripe for innovation-and moneymaking.

One organization already in this space is The Associated Press, which earlier this year announced its News Licensing Group, on the heels of last year's News Registry. "These steps position the new entity to become the uber-clearing house for digital news. Such a development has the potential to capture the entire value chain around content clearance," writes May in the report.

May concludes that aggregators of business intelligence fall into four categories: lightweight/low-cost (Google), niche providers (Salesforce.com), high-end/power tools (Dow Jones Factiva), and DIY/custom portals (Northern Light Group, LLC).

"These are all groups that have been out there, but they are continuing to converge on each other's space," says May. So how does one company win? The report outlines four "essential actions": understand that search must be free, promote value of curation, understand the breadth of competition today, and look to partner where it makes sense.

Looking forward, what will the next pain point be? "The next set is going to be about better understanding those narrowly defined user groups and serving them," says May. It will be about "getting data back from content offerings and doing something meaningful with it."