ConversationMarketing.com is an online blog run by Ian Lurie that talks about Internet marketing. According to a recent blog, “LinkAdage is now offering the web’s first open to the public EDU blog community. This is a very unique opportunity for Webmasters and SEOs not affiliated with a university to control a personal EDU blog.” This means that anyone can publish their own .edu blog without actually being in school. Such blog will be a legitimate EDU blog that one can “use to promote [their] business and increase revenues.” The author of the blog disagrees with this move by LinkAddage, and lists a number of reasons why he considers it wrong. For one, he believes this lying, and not marketing. “Visitors to a .edu domain will often trust that content more than what they find at a .com domain.” So this allows marketers take advantage of the fact that users and search engines trust .edu domains more.

This story can be analyzed using what we have learned in class and from Chapter 15 (Market for Lemons) of the Networks book draft. Since up to this point .edu was the generic top-level domain for educational institutions, users knew exactly what to expect when they clicked on a link that ended with .edu. Information was symmetrical. Now, if companies really will start actively buying web .edu domains, littering them with blogs that have little or nothing to do with education, this will result in asymmetric information in the .EDU setting. Some of the pages will in fact belong to the university, while some will belong to private owners. Assuming this in fact does catch on, both users and search engines will stop giving .edu domains as much value, i.e. such pages will lose credibility.

Now the question is the following: is this asymmetry going to drive EDU domain “out of market”? Clearly it is not money we are talking about here, since it does not cost a user anything to click onto a web link, so in this sense the answer is no. However if we consider clicking on the link itself as a ‘price’ that a user pays, then the situation can be analyzed using the “Market for Lemons” model. Originally, a user who is researching something and is looking for reliable information, will be more likely to click on .edu link than on, say .com. Now if we imagine a fraction of .edu websites that are actually owned privately increase, the probability of a user clicking on the .edu link will decrease. If this fraction reaches a certain point (or will exceed it), users will be equally likely to click on a .edu link as they are to click on .com link and the .edu “market niche”, so to speak, will disappear, as in Market for Lemons or in market for used cars.

This analogy may seem like a stretch, but I believe the Market for Lemons model works nicely even when the measure of market success is not in dollars.

http://www.conversationmarketing.com/2008/04/linkadage-selling-edu-blog-space.htm