Google Update Costs Mahalo Employees Their JobsBy: Chris Crum - March 2, 2011
Google’s recent algorithm update, aimed at content farms, has done more than harm content farms. Some unexpected casualties were hurt in the search rankings as well. Google is acknowledging this.
The update has also led to some people losing their jobs. Allen Stern at CenterNetworks reports that Jason Calacanis-run Mahalo is canning 10% of its staff because of the impact the update has had on the site’s traffic and revenue. Stern shares the following points from a Mahalo email sent by Calacanis and Mahalo President Jason Rapp:
– (re: the google change) Despite those efforts, unfortunately, the Google changes have led to a significant dip in our traffic and revenue. It’s hard not to be disappointed since we’ve been spending millions of dollars on producing highly professional content.
– Today we have eliminated a handful of positions in the company (about 10%), and we’ve cut a number of non-essential services we provide internally. In addition, we are re-evaluating our freelance content production, pausing it in the near term and determining how to best produce the high-quality educational material we aspire to in the long run. We are not, however, diminishing our video production efforts.
– Interestingly, while the search side of Google has impacted us negatively, Google’s video unit (YouTube) continues to be our strong partner, encouraging us to ramp up our video production and publish even more of our expert video lessons with them.
Interestingly enough, this comes just a few weeks after Calacanis spoke out about content farms at Federated Media’s Signal event, where he urged advertisers not to support poor quality content.
"You shouldn’t put your ads next to sub-par content," he was quoted as saying. "We will not make content unless we have an expert. Demand Media will make content if someone will take $10…Google is figuring it out. eHow makes Google look stupid."
Of course it is Mahalo that was among the sites hit by the update, while eHow has seemingly stayed put, if not helped by the update.
According to a Wired article, Google is "working to help good sites caught by the spam cleanup". This reflects a Twitter exchange we looked at between Cult of Mac publisher Leander Kahney and Google’s Matt Cutts.
It remains to be seen, however, whether Google deems Mahalo one of the "good sites" or one of the sites the update was designed to target.