Brilliant adwords hack: Demand Media

To me, this is the killer paragraph:

"Reese is a tall Texan who serves as Demand’s chief innovation officer and who created the idea-spawning algorithm that lies at the heart of Demand’s process. To determine what articles to assign, his formula analyzes three chunks of information. First, to find out what terms users are searching for, it parses bulk data purchased from search engines, ISPs, and Internet marketing firms (as well as Demand’s own traffic logs). Then the algorithm crunches keyword rates to calculate how much advertisers will pay to appear on pages that include those terms. (A portion of Demand’s revenue comes from Google, which allows businesses to bid on phrases that they would like to advertise against.) Third, the formula checks to see how many Web pages already include those terms. It doesn’t make sense to commission an article that will be buried on the fifth page of Google results. Finally, the algorithm, like a drunken prophet, starts spitting out phrase after phrase: “butterfly cake,” “shin splints,” “Harley-Davidson belt buckles.”

The scale of this thing is unbelievable. Its producting 4,000 videos and articles per day and "By next summer, according to founder and CEO Richard Rosenblatt, Demand will be publishing 1 million items a month, the equivalent of four English-language Wikipedias a year."

Sadly the quality is horrible.

Our search results are chosen by an algorithm, and now I guess created by one as well.