The Digital Skeptic: Get Ready for a Google Glass Crash

NEW YORK ( TheStreet) -- Chas Edwards thinks that what will keep Google ( GOOG) Glass from shattering will be exactly one thing: the advertising.

"We have trained a generation of people to believe that Web advertising is #$%^," Edwards told me a few weeks ago.

Edwards is not any old pissed-off Web consumer. Rather, he's a San Francisco-based new-media sales and marketing exec who has done serious time at CNET, been publisher at the New York-based social media service Digg and co-founded blog syndicator Federated Media.

Edwards is deeply worried that Google's slick, soon-to-market, wearable immersive computer, Google Glass, is on track to be Web Advertising 3.0. That is, just another in a long line of Internet marketing disasters.

"With Google Glass, users will be able to touch data," he explains. "But unless Google figures out how to make the ads that run in that world something consumers want to touch, Glass is going to be looking at big, big problems."

Edwards points out -- totally correctly, by the way -- that just as in the mobile device and Web worlds before it, how advertising integrates into the wearable computer experience is not being properly thought out.

He was not surprised when I told him a Google executive told me his company develops products first, then figures out the business model. Or that reports confirm that, at least to start, there will be no traditional advertising on Google Glass, as found on YouTube or the rest of the Internet.

In fact, Edwards says, it's an open secret in the emerging ad community that Google half expects others to solve its Google Glass advertising problems for it.

"We need to figure out how to make a digital experience on Glass that's not an ad," Raymond Velez, chief technology officer at New York digital agency Razorfish, told AdAge back in May.

Edwards argues that even sophisticated media companies such as The New York Times ( NYT) struggle to make ads work properly on the Internet we already have -- never mind sophisticated new products such as Glass.

"That is not just Google," Edwards says. "It's the entire Web." He believes that our great advertising minds have not dedicated themselves to solving the basic problems of marketing on the Internet.

"We simply don't have a Web marketing vehicle everyone values," he said. "There is no 30-second spot of Internet."

Investors need only take a gander at the otherwise marvelous online feature, Snowfall: The Avalanche at Tunnel Creek at NYTimes.com to see how deeply undeveloped Web marketing is. The piece was labeled The Future of Online Journalism and bagged both a Webby and a Pulitzer Prize, but Edwards forwarded me a screenshot of the almost nonsensical banner ad that plays inside in the feature for most consumers.

"You would think with all that effort, the Times could have come up with a better way to integrate the ad that pays for the feature," he said. "But they didn't, and it makes this otherwise marvelous story look stupid."

The 10-cent CPM
If investors look through Glass with Edwards' eyes, they'll see right away what he's looking at: a cottage industry racing to create apps and tie-ins for the technology, but with major problems that are being kicked own the road. Yet CNN, Twitter, Facebook ( FB) and numerous start-ups are betting on the technology.

"I am very interested in developing an app for Glass," confirmed Vivian Rosenthal, founder of New York-based Goldrun, developer of the Snaps! augmented reality app. "I see it as a critical new storytelling tool."

But these shops are racing against the near certainty that Google Glass will create a glut of advertising inventory that will put even deeper pressure on already falling cost-per-unit advertising rates. Ashkan Karbasfrooshan wrote over at MediaPost.com that, by some measures, cost-per-thousand click metrics could actually fall to zero.

"Today, we realize that mobile advertising is filled with so many riddles that no way on earth is the amount of time spent on the medium going to match the time we spend connected to advertisers," he wrote.

The fact is, for all its complexity, Google Glass will do exactly one thing: It will stream personal audio and video 24/7 to the Web with no need for special coding or data-entry skills. That will create a tsunami of personal content that will hit the Web like none before it, and, in turn a wall of ad inventory chasing after already meager ad dollars.

"If we don't start being more careful," Edwards says, "We are going to wind up with a Google Glass like the rest of the Web -- online crap that nobody watches."

"If we turn Glass into a simple supply and demand equation," he says, "nobody wins."
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

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